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European Shares Inch Lower Ahead Of ECB Meeting

stockmarkets aug16 04jun20 lt

European stocks fell slightly on profit taking Thursday after three days of strong gains on optimism around reopening and hopes of economic recovery.

Attention now shifts to a European Central Bank (ECB) policy meeting later today, with the central bank widely expected to ramp up emergency bond purchases to support the region's battered economies.

The ECB will also publish its new economic forecasts. ECB President Christine Lagarde will hold a press conference at 8.30 am ET.

Late Wednesday, the German coalition government agreed to a €130 billion ($211 billion) stimulus package to help Europe's biggest economy recover from the coronavirus crisis.

The pan European Stoxx 600 dropped 0.7 percent to 366.51 after climbing 2.5 percent on Wednesday.

The German DAX shed 0.8 percent, France's CAC 40 index declined 0.7 percent and the U.K.'s FTSE 100 was down half a percent.

LVMH Moet Hennessy Louis Vuitton shares fell 1.7 percent. The luxury products maker confirmed that it is not considering buying Tiffany & Co. shares on the market.

Spirits company Remy Cointreau jumped 8 percent after it predicted a strong recovery in the second half, driven by China and the United States.

HSBC Holdings fell about 1 percent while Standard Chartered gained 0.8 percent after they backed China's imposition of a national security law on Hong Kong.

Intermediate Capital Group tumbled 3.3 percent. The asset manager reported a rise in net assets, but profit fell 37 percent for the year ended 31 March.

Rolls Royce Holding gave up 3.5 percent. The engineering giant, which makes jet engines, said it would slash more than 3,000 jobs in the U.K. due to the coronavirus pandemic.

BP Plc and Royal Dutch Shell were moving lower as oil prices declined on concerns that major producers will be unable to agree to extend the record level of output cuts that have supported the recent gains.

In economic releases, Eurozone retail sales decreased 11.7 percent month-on-month in April, following an 11.1 percent drop in March, Eurostat data showed. Economists had forecast a monthly decrease of 15 percent.

The U.K. construction sector downturn eased in May reflecting a gradual reopening of construction sites as lockdown measures introduced to curb the spread of coronavirus, were eased in England, survey data from IHS Markit showed.

The IHS Markit/Chartered Institute of Procurement & Supply construction Purchasing Managers' Index rose to 28.9 in May from 8.2 in April. This was the second-lowest score since February 2009.

The construction Purchasing Managers' Index for Germany rose to 40.1 in May from 31.9 in April. Output remained deep in contraction territory in May amid reports of restrictions on workplace activity and a slump in new work.

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