Europe midday: Stocks in the black as BoE cuts interest rates

European stocks edged higher as investors digested news that the Bank of England has cut interest rates for the first time since 2009.

Just after midday, the benchmark Stoxx Europe 600 index and France’s CAC 40 were up 0.4%, while Germany’s DAX was 0.6% firmer.

In London, the FTSE 100 turned just a touch higher after the Bank of England said it had voted unanimously to cut interest rates to 0.25% as widely expected. In addition, the Bank said it will expand its asset-purchase programme by €60bn.

Dennis de Jong, managing director at UFX.com, said: “Today’s historic decision to cut interest rates for the first time in more than seven years is no major shock, but it does indicate growing concern over the state of Britain’s post-Brexit economy.

“Last month Mark Carney’s rate-setters surprised many by holding their nerve when voting against a reduction, but a raft of underwhelming economic data has finally forced their hand.Chancellor Philip Hammond will be hoping the cut provides a sharp economic boost, but analysts are already speculating it may take more extreme measures, including a possible return of quantitative easing, to kick-start growth.”

The next big focus this week will be Friday’s non-farm payrolls in the US.

In corporate news, Nokia was under the cosh after its second-quarter earnings missed analysts’ expectations.

German healthcare and chemicals company Merck was also in the red despite reporting better-than-expected quarterly profit and lifting its full-year forecasts.

Siemens racked up healthy gains as the German industrial conglomerate posted forecast-beating third quarter earnings and raised its guidance for fiscal 2016.

In London, insurers were on the front foot, with Aviva and RSA Insurance both firmly higher after well-received half-year reports. Aviva reported a 13% jump in operating profit to £1.33bn, while RSA Insurance posted a drop in pre-tax profit but a rise in operating profit and lifted its dividend.

Inmarsat advanced after the satellite operator said second-quarter profit rose and maintained its full-year guidance.

Oil prices retreated on Thursday. West Texas Intermediate was down 0.9% at $40.48 a barrel and Brent crude was off 1.3% at $42.56.