European stocks close lower on trade woes; Bank of England hikes rates; Kaz Minerals plunges 28%

Key Points
  • The Bank of England has raised interest rates, despite uncertainty over what Brexit means for the U.K. economy.
  • Kaz Minerals led the losses Thursday after announcing a $900 million copper deal in Russia.

European markets closed sharply lower Thursday, after the Bank of England announced a rate hike.

European markets

The pan-European Stoxx 600 closed provisionally down by 0.82 percent with almost every sector in the red. Basic resources dropped 2.96 percent and auto stocks fell 1.02 percent on the back of trade concerns. Overnight, President Donald Trump's administration sought to push China harder on trade by suggesting that it could increase import taxes to 25 percent on $200 billion-worth of goods.

Looking across the European index, Kaz Minerals led the losses Thursday, plunging 28.3 percent, after it said it had agreed to buy the Baimskaya copper project in the Chukotka region of Russia for $900 million. Broker Jefferies downgraded the stock to hold from buy.

Siemens shares fell 4.69 percent with the industrial firm missing estimates for its quarterly revenue.

On the other end, Amundi was among the top gainers, up by 5.44 percent, after reporting second-quarter profits. The London Stock Exchange also rose 3.213 percent after reporting its latest results. The group said that it has activated contingency plans in case the U.K. leaves Europe next year without any deal.

In other earnings news, French lender Societe Generale published its second-quarter results showing a 9.3 percent increase in net income from a year ago. Shares fell 2.25 percent.

In other corporate news, Rolls-Royce said Thursday it was taking a one-off charge of £554 million ($724 million) to deal with costs related to engine problems. Nevertheless, shares spiked 7.107 after the firm said it expects full-year underlying profit and cash flow to come in at the upper half of its guidance.

Meanwhile, on Wall Street, shares tumbled as traders eyed the latest development in Trump's trade battle with China. And tech giant Apple reached a market capitalization of $1 trillion.

BOE announces rate hike

Elsewhere, the Bank of England announced a rate hike despite ongoing uncertainty over the future of the U.K. economy.

The Monetary Policy Committee voted unanimously for an increase in rates from 0.5 to 0.75 percent on the back of a strong labor market and credit growth.

Bank of England Governor Mark Carney said at a press conference following the rate hike that the bank's policy should "walk, not run," signaling gradual rate rises. Sterling fell 0.7 percent against the dollar, at $1.3032.