Following the results of yesterday's trading, major stock exchange indices declined after a spectacular rise the day before. The main reasons for the confident bearish trading were the results of a meeting of the European Central Bank (ECB) and the talks between the foreign ministers of Russia and Ukraine.
The STOXX Europe 600 index decreased by 1.69% to 427.12, German DAX lost 2.93%, dropping to 13,442.1, French CAC 40 decreased by 2.83% to 6,207.2, and UK's FTSE 100 fell by 1.22% to 7,102.97.
The top performers among Stoxx Europe 600 index components were securities of British-Swiss mining holding Glencore Plc jumping by 5.9%, and German steelmaker Rheinmetall AG increasing by 5.6%. The main outsiders were shares of German international food delivery service Delivery Hero dropping by 9.2%, Dutch Just Eat Takeaway.com falling by 8.4%, and UK's Melrose Industries Plc losing 8.3%.
German luxury goods maker Hugo Boss AG dropped by more than 7% after the company left the Russian market due to the conflict in Ukraine. In addition, Hugo Boss reported a yearly net profit, and the company's management said it expected revenue growth of 10-15% in 2022.
The Swiss bank Credit Suisse's stock fell by 3%. Prior to that, the bank's management announced that as of December 31, 2021, its assets in Russia amounted to $915.2 million.
The capitalization of the German container transport operator Hapag-Lloyd AG decreased by 4%, despite the fact that the net profit of the company grew by 10 times in 2021.
The securities of the German carmaker BMW AG dropped by 5.5%. The company's management announced that it was recalling more than 917,000 cars in the US to fix defects.
On Thursday, market participants assessed the results of the European Central Bank meeting. Thus, the regulator predictably kept the benchmark interest rate at zero and the deposit rate at -0.5%.
At the same time, the ECB has adjusted the buyback of financial assets within the APP. Thus, the Central Bank will buy securities amounting to €40 billion in April, €30 billion in May, and €20 billion in June.
Analysts suggest that traders remained disappointed by the lack of response from the European Central Bank to the geopolitical disaster in eastern Europe. Throughout the conflict between Russia and Ukraine, the West has permanently imposed sanctions on Russia. On Tuesday, United States President Joe Biden banned imports of oil products from Russia. Major global corporations have partially or completely suspended their activities in the country, despite the prospect of declining profits.
Experts are confident that the West's sanctions will continue to persist until there is tangible progress in resolving the situation around Ukraine. This state of affairs will undoubtedly contribute to continued high volatility and unpredictability in global markets.
Earlier, economists of one of the world's largest investment banks Goldman Sachs worsened the growth forecast for 19 eurozone countries for the current year to 2.5% from 3.9%. The bank representatives explained their decision by the negative impact of the conflict between Russia and Ukraine, the winding down of economic stimuli, rising prices of energy and raw materials, as well as the undermining of international trade.
The meeting results of Russian and Ukrainian foreign ministers Sergey Lavrov and Dmytro Kuleba in Turkey were another important downward factor for the markets. The negotiations between the ministers did not lead to any visible progress towards a ceasefire.