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European stock markets muted ahead of action-packed week

written by Bella Palmer

The DAX index in Germany traded down 0.3%, while the CAC 40 in France traded 0.1% higher and the FTSE 100 in the U.K. added 0.1%

European stock markets traded in a muted fashion Monday, at the start of an action-packed week full of event risk, including the Fed’s first meeting of the year.

At 08:25 GMT, the DAX index in Germany traded down 0.3%, while the CAC 40 in France traded 0.1% higher and the FTSE 100 in the U.K. added 0.1%.

Investors have started the new week on a cautious note, with the main indices trading in tight ranges ahead of a potentially crucial policy-setting by the Fed.

The Federal Reserve is widely expected to keep interest rates unchanged on Wednesday with investors eagerly awaiting any cues that officials believe they have progressed enough in their battle against inflation to begin cutting rates sooner rather than later.

The U.S. is set to release the January jobs report on Friday, with the economy expected to have added 177,000 new jobs, slowing from 216,000 the previous month.

The BoE also meets this week, and is also expected to keep interest rates on hold on Thursday, following on from the ECB keeping interest rates unchanged at a record-high 4% last week.

In the corporate sector, Ryanair stock dropped 2.9% after the budget airline cut its profit forecast for the year to the end of March after some online travel agents stopped selling its flights in December, compelling it to reduce fares to fill seats.

Philips stock dropped 4.4% after the Dutch medical device maker reported another loss in 2023, even though the losses were cut compared with the previous year, as it seeks to rebound from a series of damaging recalls.

Bayer stock dropped more than 5% after the German pharmaceutical giant was ordered by a U.S. court to pay $2.25 billion in damages, the highest amount yet in its ongoing litigation linked to an alleged carcinogenic effect of its Roundup weedkiller.

Holcim stock added 5% after the Swiss building materials giant revealed plans to separate and list its North American business.

The European banking sector is likely to be in focus later this week as a number of the region’s major lenders release quarterly earnings.


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