Thursday 06th of August 2020 at 7:30 am
European stocks were mixed after the Bank of England predicted that the UK economy would suffer its largest contraction in a century.
European stocks were mixed on Thursday after the Bank of England predicted that the UK economy would suffer its largest contraction in a century this year.
Though the bank held both its benchmark interest rate and the size of its bond-buying programme steady, it warned that the UK’s economic output would shrink by 9.5% this year and stay below its pre-pandemic levels until at least the end of 2021.
Germany’s DAX (^GDAXI) climbed by around 0.9%, while France’s CAC 40 (^FCHI) rose by more than 0.4%. Stocks rose by around 0.1% on Italy’s FTSE MIB (FTSEMIB.MI), but fell marginally on Spain’s IBEX (^IBEX).
“It was a tough morning for the FTSE 100, dealt blows from the Bank of England and some of Thursday’s reporting companies,” said Connor Campbell, a financial analyst at trading platform Spreadex.
“Keeping interest rates at a record low 0.1%, the Andrew Bailey-led central bank warned that the UK economy shrank by 20% in the second quarter,” he said.
Stocks in Asia had a similarly mixed trading session.
Futures were pointing to a higher open for stocks in the US, even as a dispute about funding for the United States Postal Service raised the prospect of a further delay to lawmakers agreeing on new stimulus measures.
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