May 28, 2024

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Good price gains in Brussels after ECB interest rate decision

Good price gains in Brussels after ECB interest rate decision

Image: Euronext

(ABM FN) The Brussels stock market was almost unchanged shortly before the European Central Bank’s interest rate decision, but afterwards it managed to make a nice profit.

Bel20 won by 1.4 percent on 3,689.75 points.

The European Central Bank raised interest rates by 25 basis points on Thursday afternoon, bringing its key interest rate to a record high of 4.00 percent.

In an interview with ABM Financial News, Bernard Kippen, chief economist at CBC Bank, said the ECB has made it clear that this is the end of monetary tightening.

According to The Economic, this explains why the euro fell sharply below $1.07 in the aftermath, as did euro zone bond yields. The 10-year German Bund, the European benchmark, lost 6 basis points to 2.59 percent in the early evening.

This decline in bond yields has gone hand in hand with the stock market rise.

Kibben added that the ECB, in line with expectations, raised inflation forecasts while lowering growth forecasts. The Frankfurt-based institution now expects inflation to reach 5.6 percent this year and 3.2 percent next year. The euro zone economy is expected to grow by 0.7% instead of 0.9% this year. For 2024, the estimate was reduced from 1.5 to 1.0 percent.

Economist Luc Appin of Van Lanschot Kempen stated that the eurozone is experiencing stagflation-like characteristics, because inflation persists while the economy in the currency union is stagnant. “Which makes it difficult for central bankers,” the economist said.

Meanwhile, oil prices continue to rise, with WTI surpassing $90 per barrel for the first time in ten months.

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Now that the European Central Bank has approved, investors will turn their attention to the Federal Reserve, which will make a new interest rate decision within a week.

The risers and the fallers

In Bel20, Elia was the biggest gainer with its price rising by 3.1 per cent, followed by Aperam which rose by 2.9 per cent.

Sofina, on the other hand, clearly suffered from THG’s disappointing numbers and lower expectations, losing 1.7 percent and finishing at the bottom of the Star Index.

Outside the main index, Colruyt shares rose 0.8 percent. Degroof Petercam raised the price target for Colruyt from €40.00 to €45.00 with a buy recommendation. The investment bank does not rule out that Colruyt will make a full or partial offer for its own shares on September 27.

EVS was at least 3.7 percent higher. Here, Degroof Petercam raised the price target from EUR 24.00 to EUR 33.00 and the recommendation was raised from Hold to Buy.

BPost rose 3.5 percent, Atenor rose 4.9 percent, while Compagnie du Bois Sauvage lost 1.7 percent.

At BelSmall, Ekopak rose 1.6 percent thanks to the announcement of the acquisition of GWE. Sequana Medical shares rose 2.6 percent after the quarterly update, while Belisi’s share price rose 5.7 percent.

Shares of Onward Medical, which announced a partnership in the US, rose 3.8 per cent, while Mithra shares fell 8.4 per cent.

Wall Street

In New York, stock markets also posted gains.

Source: ABM Financial News

ABM Financial News is a resource for stock market news, video and data, both for real-time trading platforms and trading rooms and for online and offline media publications. The information in this article is not intended to provide professional investment advice or a recommendation to make particular investments.

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