European indices dropped by a maximum of 1.5 months


Moscow. November 13. European stocks declined at a record pace in six weeks in Thursday on statements of the head of the European Central Bank (ECB) Mario Draghi and the President of the Federal reserve Bank (FRB) of St. Louis James Bullard, Bloomberg reported.

The composite index of the largest enterprises of the region Stoxx Europe 600 fell by 1.62% to 372,56 item.

The index of the largest companies in the Eurozone Euro Stoxx 50 on Thursday lost 1,76%, French CAC 40 – 1,94%, the German DAX was 1.15%, British FTSE 100 – 1,88%.

In his speech at the European Parliament, Draghi said there was “obvious” downside risks to the Eurozone economy and easing inflation dynamics.

These words have raised expectations that the ECB will increase monetary stimulus in December, however, raised concerns for the overall state of the European economy.

“Draghi signaled the likely extension of quantitative easing, but many have learned from his words that with the European economy something not so, said an analyst at Quoniam Asset Management sören Steinert. – In addition, the season of corporate reporting in General is not encouraging”.

Meanwhile, the head of the Federal reserve Bank of St. Louis Ballard, one of the most active supporters of tighter monetary policy in the US, said that emergency stimulus measures, including a zero rate on Federal loan funds (federal funds rate) are no longer needed by the economy, which had almost recovered to the normal state.

According to him, the unemployment rate in the U.S. (5% in October) corresponds to the long-term target, while inflation, excluding fuel prices, nearing the targeted level of 2%.

The maximum fall on Thursday showed paper the mining and energy companies amid falling prices for raw materials, including oil.

The price of the securities of the Spanish Repsol, the reporting of which has not justified expectations of experts, was down 7%.

The value of shares of RWE AG, the largest utility company in Germany, fell at the end of trading 9.2%. RWE adjusted profit for 9 months of 2015 decreased by 29% to 545 million euros, being worse than the average market forecast at the level of 609 million euros.

The capitalization of Dutch insurer Aegon NV sank 11% after the company reported a loss last quarter.

Shares of Rolls-Royce Holdings fell by 19%. British industry group has warned about the deterioration of expectations on the current and next year, and also about a possible decrease in dividends.

So, the company believes that the rate of pre-tax profit of Rolls-Royce in 2016 will be lower than the expected 650 million pounds ($990 million). Pretax profit in 2015 is likely to correspond to the lower boundary of the previously announced forecast range of 1.3-1.48 billion pounds.

At the same time, the German pharmaceutical company Merck KGaA raised its forecast of annual profit increased by 1.6%. Shares of Siemens, announcing an increase in dividends and the launch of a new share repurchase programme, increased in price by 2.1%.