Europe Markets

European markets close lower after BOE keeps rates unchanged; Novo Nordisk down 7%


European stocks closed lower on Thursday after the Bank of England decided to keep its monetary policy unchanged, but raised its growth forecasts for 2017.

The pan-European Stoxx 600 ended 0.34 percent lower. The FTSE 100 rose 0.47 percent and sterling, which had hit a seven-week high ahead of the BoE announcement, dropped over 0.9 percent against the dollar following the news.

The BoE raised its growth forecasts after being wrong-footed by the strength of the economy despite Britain's decision to leave the European Union. The bank also revised down its inflation forecasts for the next three years.

The U.K. government has offered a little more clarity on its Brexit negotiations Thursday. Brexit minister David Davis presented the government's official report, also known as a white paper, to the House of Commons. The white paper is set to be debated vigorously by lawmakers over the coming weeks.

Meanwhile, health care stocks were the worst performers on Thursday, down by more than 1.1 percent, after lower-than-expected earnings for several companies. AstraZeneca said Thursday its revenue and profit would drop in 2017 and Novo Nordisk also lowered its 2017 sales outlook. Shares of the latter were close to the bottom of the European benchmark, down by more than 7.2 percent.

Steel producer Outokumpu ended at the top of the European benchmark after proposing an annual dividend for the first time in 6 years, Reuters reported. Shares of the Swedish tech firm Hexagon also surged higher in European trading and closed up by more than 6.3 percent after agreeing to buy the U.S.-based MSC software firm for $384 million.

Reckitt Benckiser ended among the best performers too, up by more than 4 percent, after reports it's considering purchasing the baby-food maker Mead Johnson Nutrition.

Meanwhile in the U.S., the Dow Jones industrial average and broader S&P 500 both pared losses to trade around the flatline as investors eyed earnings and key economic data.

Deutsche Bank falls 5%; Shell shares rise

Meanwhile, Deutsche Bank reported a full-year net loss of $1.46 billion, an improvement from a net loss of $7.3 billion in 2015. The bank's shares were down by more than 5.2 percent on Thursday with fourth-quarter results failing to match expectations.

Finland's Danske Bank reported a better-than-expected pretax profit in its fourth quarter. As a result, its shares moved more than 3.3 percent higher. Swedbank reported a slightly higher-than-projected increase in its fourth-quarter earnings due to a pickup in lending volumes.

Shell announced a 8 percent drop in 2016 earnings to $3.5 billion. Its shares closed higher by 1.91 percent on Thursday.

The Finish firm Nokia presented sales above expectations in its fourth quarter with earnings before profit, taxation and amortization of 108.5 million euros. It was one of the best-performing companies on Thursday.

Vodafone reported earnings at the lower end of the range and posted a 3.9 percent drop in its third-quarter revenues.

Overnight, the Federal Reserve kept its benchmark overnight lending rate target at 0.5 percent to 0.75 percent, and its statement noted that there were improvements to sentiment.

—CNBC's Aza Wee Sile contributed to this report.

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