Europe close: Stocks end on mixed note after ECB, Italian shares fly
Shares ended on a mixed note as the European Central Bank continued to tiptoe closer to normalising its monetary policy, and the risk of early elections in Italy receded, according to some observers, sending government bond yields sharply lower in the process.
As expected, on Thursday the ECB's Governing Council tweaked its forward guidance, removing a reference to the possibility of a further reduction in interest rates. However, it kept the door open to further quantitative easing if necessary.
"Overall, Draghi's rhetoric confirmed that the central bank is in no rush to exit its accommodative stance. The GC remains on track for a tapering announcement in September, with implementation starting next year. But it is becoming increasingly clear that normalization will happen at a slow pace," said Marco Valli, chief Eurozone economist at UniCredit Research.
The ECB also lowered its medium-term consumer price inflation projections, with one well-placed trader saying that was incompatible with any expectation of an announcement of tapering until they edged higher again.
The benchmark Stoxx 600 finished 0.01% lower at 389.15, alongside gains of 0.32% for the German Dax to 12,713.58.
Italy's FTSE Mibtel on the other hand ended the session near its best levels of the day, gaining 1.46% to 21,042.41. According to one report, failure by the major parties to agree to a new election law meant there was less of a threat of early elections taking place in 2017.
In parallel, a gauge of lenders' shares advanced 1.08% to 182.75. According to La Repubblica, Intesa SanPaolo was ready to inject fresh capital into the country's Veneto banks if other domestic lenders were willing to do the same.
Spain's Ibex 35 also did well, with a 5.24% jump in Santander driving gains of 0.75% on the benchmark.
Meanwhile, the Stoxx 600's gauge of Basic Resource companies jumped 1.13% to 395.41 following the release of stronger-than-expected Chinese trade numbers and supportive LME inventory figures for most base metals.
Acting as a backdrop, in testimony to a Senate panel former FBI chief James Comey said he had felt instructed by the president to stop an investigation into his national security adviser, Michael Flynn.
In economic news, growth in the euro area economy accelerated to a 0.6% quarter-on-quarter clip in the first three months of 2017, up from the 0.5% pace observed over the prior three months (consensus: 0.5%), led by growth in Germany and for investment.
Remy Cointreau was on the frontfoot after telling investors to expect better profitability.
Allianz was studying purchasing the stake it did not already own of French trade credit insurer Euler Hermes Group, Bloomberg reported.
Bain Capital and Cinven lowered the minimum acceptance threshold for their takeover of Germany's Stada to 67.5%, while extending the acceptance period until 22 June.
Heidelberger Druckmaschinen told markets to expect operating profit margins for its 2017/2018 fiscal years of between 7% and 7.5%, with sales at the prior year level.