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European Markets Drop After Euro Surges

The majority of the European markets ended Thursday's session in the red. After fluctuating between small gains and losses in early trade, the markets turned definitively lower following the release of the minutes of the latest ECB meeting.

The European Central Bank could change the tone of its monetary policy communication early this year to reflect the improvement in growth prospects, minutes of the latest policy session showed on Thursday.

"Looking ahead, the view was widely shared among members that the Governing Council's communication would need to evolve gradually, without a change in sequencing, if the economy continued to expand and inflation converged further towards the Governing Council's aim," the central bank said in the summary, which it calls "account", of the December 13-14 policy session.

"The language pertaining to various dimensions of the monetary policy stance and forward guidance could be revisited early in the coming year."

The Euro jumped against the dollar following the release of the ECB minutes. The rise in the currency pressured shares of European exporters.

The pan-European Stoxx Europe 600 index weakened by 0.30 percent. The Euro Stoxx 50 index of eurozone blue chip stocks decreased 0.40 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, lost 0.33 percent.

The DAX of Germany dropped 0.59 percent and the CAC 40 of France fell 0.29 percent. The FTSE 100 of the U.K. gained 0.19 percent, but the SMI of Switzerland finished lower by 0.22 percent.

In Frankfurt, auto supplier Continental AG gained 0.17 percent on reports of business revamp.

In Paris, Sodexo tumbled 5.12 percent. The food services and facilities management group reported that its first-quarter revenues totaled 5.3 billion euro, down 2.6 percent compared to the same period in the previous fiscal year.

In London, Rio Tinto gained 1.87 percent after receiving a binding offer from Liberty House for its Aluminum Dunkerque smelter in northern France.

Recruitment firm Hays climbed 4.25 percent after posting double-digit growth in Q2 net fees.

Tesco tumbled 4.53 percent after Christmas trading results in its core U.K. business fell short of market expectations.

Similarly, Marks and Spencer Group lost 7.04 percent after reporting a 2.8 percent fall in like-for-like sales for its struggling clothing and home divisions over the Christmas quarter.

Weir Group fell 1.95 percent. The engineering firm said that changes in U.S. taxes will result in a one-off non-cash tax credit for 2017.

Richemont rose 0.56 percent in Zurich after it posted 1 percent growth in third-quarter sales, despite weakness in Europe and Japan.

Eurozone industrial production grew the most in three months in November, Eurostat reported Thursday. Industrial output climbed 1 percent month-on-month, following October's 0.4 percent increase. This was the fastest growth since August and also exceeded the expected increase of 0.8 percent.

The German economy expanded at the fastest pace in six years in 2017, driven by domestic demand, preliminary data from Destatis showed Thursday.

Gross domestic product grew 2.2 percent in 2017 after expanding 1.9 percent in 2016. This was the fastest growth since 2011. The biggest euro area economy has expanded for the eighth year in a row.

The growth rate also exceeded the average of the last ten years by almost a percentage point. Nonetheless, growth was below economists' expectations of 2.4 percent.

France's economy expanded at a faster pace in the fourth quarter of 2017, according to the Bank of France survey. Gross domestic product is likely to have expanded 0.6 percent in the fourth quarter, revised up from 0.5 projected earlier. The economy had expanded 0.5 percent in the third quarter.

For the second consecutive week, the Labor Department released a report on Thursday showing an unexpected increase in first-time claims for U.S. unemployment benefits. The report said initial jobless claims climbed to 261,000 in the week ended January 6th, an increase of 11,000 from the previous week's unrevised level of 250,000.

The modest increase came as a surprise to economists, who had expected initial jobless claims to edge down to 245,000.

A report released by the Labor Department on Thursday unexpectedly showed a modest decrease in producer prices in the month of December.

The Labor Department said its producer price index for final demand edged down by 0.1 percent in December after climbing by 0.4 percent in November. Economists had expected prices to rise by 0.2 percent.

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