Europe close: Stocks edge higher as ECB hints at extending QE

European stocks edged higher on Thursday as investors digested another set of disappointing German data, after minutes European Central Bank’s latest policy meeting revealed Brussels could extend its stimulus programme.

The benchmark Stoxx Europe 600 index closed up 0.19%, while France’s CAC rose 0.18% and Germany’s DAX was climbed 0.23%.

The euro was on the front foot against the main currencies, rising 0.34% against both the dollar and the yen and gaining 0.42% against the pound, while Brent crude surged 1.97% to $52.36 a barrel.

ECB could extend QE

The European Central Bank reiterated that it would consider extending its asset purchase programme if the economic outlook worsened, according to minutes of the 2-3 September policy meeting on Thursday.

During the ECB's last meeting, policymakers noted risks including lower commodity prices, the euro exchange rate appreciation, lower-than-expected economic growth, weak inflation and a slowdown in emerging economies.

“A first step could be to extend the asset purchase programme until at least a later date than September 2016, which we think could be announced as early as October, to reinforce the forward guidance,” analysts at Barclays said.

“Increasing the size and scope of asset purchases would be the next step, but we think it is unlikely to be decided in October unless a bigger shock materialises in the meantime.”

German data disappoints

On the economic data front, figures from Germany’s Federal Statistics Office showed exports fell by the biggest amount since 2009. Seasonally-adjusted exports dropped 5.2% in August from July, while imports fell by 3.1%.

In company news, Deutsche Bank fell 2% after it said late on Wednesday that it expects to book an impairment of around €5.8bn in the third quarter for a write-down related to its corporate banking unit.

The bank also said it will take an impairment on its stake in China’s Hua Xia Bank and will set money aside around €1.2bn for litigation. As a result, the lender will either reduce or suspend the dividend for 2015.

Some analysts argued that the scrapping of the dividend would allow the bank to avoid a capital increase.

Anheuser-Busch InBev shed 1.17% as it hit back at SABMiller on Thursday after the London-listed brewer rebuffed its third approach, calling on its shareholders to push the board to engage in talks.

AB InBev said it was surprised that the board of SABMiller continues to say that its proposal “still very substantially undervalues” the company, adding that this lacks credibility.

Fiat Chrysler Automobiles rose after the company struck a deal with United Auto Workers, averting a strike that could have shut down production at US plants.