European banking shares fell 1%, leading the losses in the financial sector
European stocks opened lower on Thursday, after a weak trading session on Wall Street the day before, when the Federal Reserve announced a widely expected rate hike of 25 basis points, and hinted it might suspend monetary tightening soon.
The European Stoxx 600 index fell 0.4% by 08:08 GMT, after closing at its highest level in more than a week, on Wednesday.
US stock futures stabilized after a turbulent session on Wall Street after the US Reserve raised interest rates to a range between 4.75 and 5% despite the recent turmoil in the banking sector, but backed down from its talk of “continuing increases” in interest.
European banking shares fell 1%, leading the losses in the financial sector, and Citigroup downgraded the sector’s credit rating, warning that the rapid pace of interest rate hikes would affect economic activity and bank profits.
Investors expect interest rate hikes from the central banks of the UK, Norway and Switzerland later today.
While Sanofi shares rose 3.9% after the French pharmaceutical company said that its drug for the treatment of asthma and eczema, which it developed jointly with Regeneron, had achieved all goals in trials to treat “smokers’ lungs”.