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European shares rise on hopes of ECB action

Published 06/06/2019, 08:34
Updated 06/06/2019, 08:40
European shares rise on hopes of ECB action
IT40
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(For a live blog on European stocks, type LIVE/ in an Eikon
news window)
June 6 (Reuters) - European shares rose on Thursday, as
expectations the European Central Bank will provide more
stimulus for an ailing euro zone economy countered
disappointment over the collapse of Renault-Nissan's merger with
Fiat-Chrysler.
The pan-European STOXX 600 index .STOXX was up 0.3% by
0717 GMT, with the auto sector .SXAP , down 0.48%, preventing
stronger gains.
Shares of Fiat Chrysler Automobiles MV FCHA.MI slipped
1.6%, weighing on Milan's bluechip index .FTMIB , after the
Italian carmaker abandoned its $35 billion offer for Renault SA
RENA.PA . Renault's shares slumped about 8%. Fearful of a global recession, markets have been in a state
of flux this week, with worries over Washington's escalating
trade tensions with Beijing and Mexico giving way to hopes that
major central banks would provide fresh stimulus in response.
The ECB, which announces its interest rate decision at 1130
GMT, is expected to seek to give the economy a boost and may
even set the stage for more action later this year as the trade
tensions unravel the benefits of years of ECB
stimulus. In a well-flagged move, ECB President Mario Draghi will
likely offer to pay banks if they borrow cash from the central
bank and pass it on to households and firms. Draghi's news
conference is at 1230 GMT.
Interest-rate sensitive banks .SX7P were marginally lower
with French bank Credit Agricole CAGR.PA down 1% after
unveiling a new set of higher profit targets for 2022 while
saying it expects a lower return on tangible equity.

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