Europe midday: Shares hold gains ahead of ECB rate call

18th Jul 2024 10:34

(Sharecast News) - European shares held gains at midday on Thursday as investors turned their attention towards an interest rate decision from the European Central Bank.

The pan-European Stoxx 600 was up 0.36% to 516 .68, with all major regional bourses higher. Traders expect the ECB to keep rates on hold this month as it grapples with stubborn inflation in the services sector.

Scope Markets analyst Joshua Mahony said markets were hoping to see ECB chief Christine Lagarde lay the groundwork for a September rate cut.

"Coming hot off the heels of yesterday's final CPI readings which saw headline inflation confirmed at 2.5%, it looks likely that the bank will hold off and gear up for a super September that currently looks in line to see the ECB, BoE, and Federal Reserve all cut rates."

"With that in mind, today is most likely going to be dominated by the tone of Lagarde, although traders will likely eye up the August Jackson Hole meeting as the potential event for the central bankers to set out their stall."

In the UK official figures showed that wages grew at their slowest pace in nearly two years in the three months to May.

Annual pay excluding bonuses was up 5.7%, down from 6% growth in the previous three-month period. This was in line with economists' expectations and marked the slowest pace of growth since September 2022.

Including bonuses, total earnings rose 5.7%, down from 5.9%, and also as expected.

In equity news, Getinge shares surged as the Swedish medical equipment maker posted Getinge reported better-than-expected second-quarter earnings, as its order intake grew despite long term problems with its product packaging and heart products.

Shares in Finnish telecoms group Nokia slumped after operating profit fell 32% in the second quarter due to continued weak demand for 5G telecom equipment.

Husqvarna shares fell after a decline in second quarter profits.

Reporting by Frank Prenesti for Sharecast.com