Europe open: Investors cheered by dovish stance from ECB, Fed
European shares edged closer to record highs on Wednesday as US and eurozone central bankers maintained dovish positions on interest rates, despite recent worries about rising inflation.
The pan-European Stoxx opened up 0.19% with major regional bourses all higher.
US Federal Reserve officials reaffirmed a dovish monetary policy stance, while European Central Bank board member Fabio Panetta said the ECB should not reduce the pace of asset purchases from next month.
“Fed speakers stuck to the script, saying they’ll look through transitory inflation spikes, but vice-chair Richard Clarida underscored a change in the tune we have seen since the April meeting minutes were released by saying that the central bank could start tapering in the coming months,” said Neil Wilson at Markets.com.
“So, we have the Fed carefully guiding markets – ‘don't worry about inflation but at the same time we are going to be exiting full emergency mode’. This offers a bit of a muddy picture for the market that’s reflected in the price action showing no real conviction.”
Shares in British Land fell as the company's annual profit fell by more than one-third and the value of its properties dropped by more than 10% as the Covid-19 crisis took its toll on the commercial landlord.
Underlying profit for the year to the end of March dropped 34.3% to £201m as British Land made provisions for non-payment of rent. British Land said it collected 83% of rent due for the year comprising 99% of office rent and 71% of retail
UK retailer Marks & Spencer jumped 5.5% despite reporting a slump in full-year profit as the Covid pandemic hammered clothing sales.
French food company Danone slipped 1.6% after a downgrade to ‘sell’ by Berenberg.