Europe markets drift higher on eve of key ECB meeting
March 09 2016 10:13 PM
KRISHNAN
The headquarters of E.ON is seen in Duesseldorf. The German utility giant’s shares were the biggest losers on Frankfurt’s DAX 30 yesterday, down 3.1% to €8.07.

AFP/London

Europe’s main stock markets drifted higher yesterday, shrugging off losses across Asia on the eve of a key ECB meeting as traders look for policy action from central bankers.
The European Central Bank will almost certainly announce new stimulus measures at its policy meeting today, analysts said, as eurozone inflation turns negative and the economic outlook continues to cloud over.
“European shares traded with a positive bias yesterday but enthusiasm for the rally that began mid-February appears to be running a little thin on the ground,” said market analyst Jasper Lawler at CMC Markets.
In London, the FTSE 100 up 0.3% at 6,146.32 points; Frankfurt - DAX 30 up 0.3% at 9,723.09 points and Paris - CAC 40 up 0.5% at 4,425.65 points at the close yesterday.
World indices had fallen heavily on Tuesday and nervous investors in Asia resumed selling yesterday on worries over the weak global economy.
The International Monetary Fund on Tuesday urged governments to take action to prevent another global recession, warning there was an increasingly “dangerous” view that policymakers are out of ideas or had lost the will.
After disappointing financial markets with what were widely perceived as half-hearted measures in December, ECB chief Mario Draghi will announce bolder policy moves this time round, central bank watchers predicted.
These were most likely to include a further cut in interest rates, an increase in the volume of bonds it buys each month under its so-called quantitative easing or QE stimulus programme and a further extension of that measure beyond its current timeframe of March 2017.
Nevertheless the euro held up against the dollar as renewed doubts swept the market.
“The tension is reaching its peak: will Mario Draghi disappoint the markets?” said John Plassard at Mirabaud Securities in France.
In company news, German power giant E.ON said it booked a €7.0bn ($7.7bn) net loss in 2015 and warned that “the course ahead will be
tougher and longer than anticipated”.
German power utilities have complained that the country’s transition from conventional carbon fuels to greener, cleaner sources of energy is squeezing their margins.
E.ON shares were the biggest losers on Frankfurt’s DAX 30, down 3.1% to €8.07.
Meanwhile BMW was not far behind despite announcing it had clocked up record sales and profits in 2015.
Net profit rose by 10% to €6.4bn as the number of vehicles sold rose by 6.1% to 2.247mn.
But investors looking for a €1 increase in the dividend to mark the record results and the company’s 100th anniversary were disappointed with the 30 cent increase offered, sending BMW shares down 1.9% to €78.54.
Wall Street stocks advanced along with oil prices and European equities, with the Dow Jones Industrial Average up 0.4% in late morning trading.
In Asia, investors resumed selling yesterday as the optimism that had fuelled this month’s rally was broken by another round of weak Chinese data that rekindled fears about the global economy.




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