European equities moved lower on Wednesday morning following comments from Fed Chairman Jerome Powell committing to a gradual increase in interest rates.
European stocks open lower on Powell’s comments; Solvay, Carrefour to report European stocks open lower on Powell’s comments; Solvay, Carrefour to report
European equities moved lower on Wednesday morning following comments from Fed Chairman Jerome Powell committing to a gradual increase in interest rates.
The pan-European Stoxx 600 was 0.3 percent lower with most sectors trading in negative territory. Insurance stocks were the only sector trading above the flatline on results. Admiral Group rose above 5 percent in early trade after announcing a dividend of 58 pence per share and a 43 percent increase in pre-tax profit.
All the other sectors traded lower as investment sentiment continued to be influenced by Tuesday’s remarks from Fed Chair Powell. The recently-appointed chairman said that it was possible the central bank could increase rates more than three times this year. Expectations of a more hawkish Fed are traditionally harmful to stocks as higher rates increase firms’ costs.
Earnings
Looking across the European benchmark, Dialog Semiconductor hit the top of the index, up by 7 percent after reporting its latest results. On the other hand, Biomerieux fell more than 8 percent after positing results.
Solvay said Wednesday that profit growth should slow down in 2018 though its fourth-quarter numbers came in line with expectations.
Bayer saw its fourth-quarter net profit fall due to a tax overhaul in the U.S. The firm didn’t add any details on the merger with Monsanto but said that wants to see the deal closed in the second quarter. The stock fell 3 percent.
Ahold Delhaize’s net income grew more than four times in the fourth quarter compared to the same period a year ago. Shares rose 1.6 percent.
ITV said that a tough ad market contributed to a 5 percent drop in earnings. The stock was down by 7 percent.