The central bank kept rates unchanged and struck a cautiously optimistic tone on the economy
[BENGALURU] European stocks fell on Thursday (Oct 9), dragged lower by steep losses in HSBC and Ferrari, knocking the Stoxx off its record perch as investors kept a wary eye on France’s deepening political turmoil.
The pan-European Stoxx 600 closed 0.4 per cent lower, coming off its record high hit in the last session.
Ferrari shares skidded to their worst single-day drop on record, closing at their lowest since April, as underwhelming long-term financial targets dulled investor enthusiasm and stole the spotlight from the luxury Italian carmaker’s electric debut.
Auto stocks logged their worst daily performance since March, with Michelin also adding to the blow. The French tyre maker was off 3.8 per cent after saying its third-quarter sales volumes would decline compared to the previous year.
Shares of HSBC dropped 5.4 per cent, the biggest drag on the Stoxx, after the British lender said that it plans to buy out minority shareholders in its Hang Seng Bank subsidiary in a deal worth around US$13.6 billion.
“There are obviously concerns about the timing and the variation of the deal,” said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank.
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Lloyds Banking Group shed 3.3 per cent after the lender said that it would likely need to set aside more cash to cover the cost of compensating motor finance customers in a probe.
Eyes on France
Investors kept a close watch on France as President Emmanuel Macron hunted for his sixth prime minister in less than two years, hoping the next pick could navigate a budget through a crisis-hit legislature.
French assets were rattled earlier this week after Sebastien Lecornu, France’s fifth prime minister in two years, tendered his and his government’s resignation just hours after announcing the Cabinet line-up.
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The regional blue-chip index gave up early gains to close 0.2 per cent lower. Still, the benchmark remains one of the laggards in 2025, up about 9.2 per cent compared to double-digit per cent gains in other top nations.
On the macro front, European Central Bank policymakers concluded last month that their toolkit remains strong enough to handle shifts in the euro zone’s inflation outlook, allowing them to hold steady until the picture clears, minutes from the September 10-11 meeting showed.
The central bank kept rates unchanged and struck a cautiously optimistic tone on the economy, signalling that any further easing would require a high bar, even as US tariffs continue to cloud the horizon.
Back to stocks, Germany’s Gerresheimer slumped 18.2 per cent after the packaging and medical equipment maker cut its annual outlook.
EDP Renovaveis gained 1.4 per cent after Jefferies upgraded its rating on the Portuguese wind energy producer to “buy” from “hold”. REUTERS
