LONDON: European stock markets slumped on Thursday, taking their lead from Tokyo which fell heavily as the Bank of Japan shocked traders by deciding against fresh stimulus measures.
The surprise move by the BoJ came after the Federal Reserve provided a positive outlook on the global economy, highlighting mixed signals from the world’s leading central banks.
Wall Street had finished mostly higher on Wednesday after the Fed suggested that it was less worried about international economic and market problems than in March, as the US central bank kept interest rates unchanged.
Around 1015 GMT on Thursday, London’s benchmark FTSE 100 index was down 1.1 percent compared with Wednesday’s closing level.
In the eurozone, Frankfurt’s DAX 30 index shed 1.3 percent and the Paris CAC 40 retreated by 1.4 percent in value. Madrid’s IBEX 35 index tumbled 2.3 percent.
The eurozone “was dealt another inflation blow as Spain’s latest CPI (inflation) reading came in at far worse than expected”, said Connor Campbell, analyst at Spreadex trading group.
“On top of that its unemployment rate ticked up to 21 percent, painting a sorry picture of the country’s economy ahead of Spain’s second general election” in June.
