The pan-European Stoxx 600 index was 0.1% lower at 491.90, with the German Dax dropping 0.14% alongside to 17,068.43, while Spain’s Ibex 35 jumped 0.94% to 10,038.20
European stocks traded in mixed fashion again on Tuesday as investors fretted about the timing of interest rate cuts, while French car parts supplier Forvia declined after announcing large job cuts.
The pan-European Stoxx 600 index was 0.1% lower at 491.90, with the German Dax dropping 0.14% alongside to 17,068.43, while Spain’s Ibex 35 jumped 0.94% to 10,038.20.
Brent crude oil futures and German Bund yields both moved down, but the euro caught a modest bid.
The ECB announced that negotiated pay growth slid from 4.7% in quarterly year-on-year terms in Q3 2023 to 4.5% during the last three months of the same year.
That slight decline had some economists anticipating that the European Central Bank would wait to have the first quarter data in hand before contemplating rate cuts.
Eurostat reported that area construction dropped 0.8% month-on-month in December, while the ECB said the bloc’s seasonally adjusted current account surplus hit €32 billion ($34.55 billion) in December, versus €26.4 billion ($28.51 billion) in the month before.
For all of 2023 the surplus was put at 1.8% of Gross Domestic Product, against a deficit of 0.6% in 2022, reflecting a reversal of the terms of trade shock from increasing energy prices because of the war in Ukraine, Pantheon Macroeconomics said.
Overnight, China’s central bank cut the benchmark five-year LPR for the first time since June and by more than expected to 3.95%.
Nonetheless, it left the one-year rate – used for most personal and corporate borrowing – unchanged.
In equity news, Forvia dropped sharply as the firm said it would cut around 13% of its European workforce over the next five years to compete with Asian rivals in the shift to electric cars.
UK bank Barclays was in focus after announced in first major overhaul in 10 years. Shares were higher after the lender announced a major operational overhaul including massive shareholder payouts, substantial cost cuts, asset sales and a reorganisation of its business divisions as annual profits declined.
