The European stock markets closed sharply lower on Thursday as the Stoxx Europe fell 1.52%, Germany's DAX dropped 1.20%, the FTSE in London lost 1.14%, France's CAC 40 declined 1.22%, and the Swiss Market Index closed 1.93% lower. In the UK, the Bank of England's monetary policy committee voted 6-3 to maintain its Bank Rate at 4.75%.
The three dissenting members were looking for the Bank to cut interest rates by 25 basis points to 4.5%. "A gradual approach to removing monetary policy restraint remains appropriate," the Bank said in a statement. "Monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further." In Germany, consumer sentiment rose slightly, with the GfK Consumer Climate index indicating that income expectations and the willingness to buy increased in December, while the willingness to save decreased.
GfK forecasts an increase of 1.8 points to -21.3 points for January. In France, the business climate in December "darkened further," as reported by the Institute of Statistics and Economic Studies, with its business climate index declining for the third consecutive month to 94 from 96 in November, remaining below its long-term average of 100. In corporate news, Italy's competition regulator AGCM announced it has closed its investigation into Booking.com, initiated in March to determine if the company was abusing a dominant market position regarding its hotel pricing policy.
The watchdog concluded that commitments made by the company satisfied its competition concerns. Telecommunications company Veon has confirmed its move of headquarters from Amsterdam to Dubai. The remaining functions at the Amsterdam office will be further scaled down. Banco Santander's Brazil unit and Banco BRG Pactual are engaged in discussions to acquire Julius Baer Group's Brazil unit, as reported by Bloomberg.
Santander shares experienced a decline of over 2% in Madrid. Semiconductor stocks faced a downturn in Thursday trading following Micron Technology's Q2 earnings forecast, which fell short of analyst expectations. French semiconductor firm STMicroelectronics dropped more than 6% in Paris, while German semiconductor giant Infineon closed more than 5% lower in Frankfurt..