BoE and Norges Bank Held Rates Steady, Passenger Car Registration Dropped 18% In August

Bridgette Randall
19 Sep, 2024
London

European stock market indexes advanced, and investors reviewed the latest monetary policy decisions in the UK and Norway. 

Benchmark indexes in London, Paris, and Frankfurt traded higher after the U.S. Federal Reserve cut its main lending rate range by 50 basis points and signaled possible rate cuts in the year. 

The Bank of England held its main financing rate at 5.0%, as widely expected by investors. 

The central bank in the UK held rates steady after lowering rates by 25 basis points for the first time in over four years. 

The Monetary Policy Committee voted 8-1 to keep the bank rate at 5.0%, with one member dissenting to trim the rate by 0.25%. 

In a unanimous vote, the committee voted to lower the purchase of government bonds by £100 billion over the next 12 months to £558 billion. 

The Norges Bank held steady its policy rate at a sixteen-year high of 4.5%, and signaled rates are likely to remain unrevised for the remainder of the year. 

The Norges Bank left its rate unrevised for the sixth consecutive meeting in September. 

 

EU passenger Car Registration Plunged 18% In August 

Passenger car registration in the European Union plunged by 18.3% to 643,637 in August, reversing an increase of 0.2% in the previous month, said the European Automobile Manufacturers' Association on Thursday. 

In four leading markets in the union, car sales declined amid weakness in battery-operated vehicles. 

Passenger car registration in Germany declined 27.8%, in France fell 24.3%, in Italy dropped 13.4%, and in Spain decreased 6.5%. 

Battery electric car registration plunged 43.9% to 92,627 units, with total market share slipping to 14.4% from 21% in the previous year. Sales in Germany fell 68.8% and in France dropped 33.1%. 

Sales of battery-operated electric vehicles declined for the fourth consecutive month in a row, after rising steadily nearly every month last year. 

For the first eight months of 2024, passenger car registration increased 1.4% to 7.2 million units, after sales increased 4.5% in Spain and 3.8% in Italy but stagnated in France and Germany. 

 

Europe Indexes and Yields

The DAX index increased by 1.5% to 18,986.06; the CAC-40 index rose by 2.0% to 7,593.55; and the FTSE 100 index added by 1.3% to 8,363.69. 

The yield on 10-year German bonds edged higher to 2.19%, French bonds inched higher to 2.93%, the UK gilts edged up to 3.84%, and Italian bonds increased to 3.55%.

The euro edged up to $1.11; the British pound inched higher to $1.32; and the U.S. dollar weakened to 84.59 Swiss cents.

Brent crude increased $0.41 to $74.06 a barrel, and the Dutch TTF natural gas fell by €0.78 to €36.37 per MWh. 

 

Europe Stock Movers

Next plc increased as much as 2% before easing to a decline of 0.1% to 10,325.0 pence, and the UK apparel retailer estimated an annual profit of £1 billion. 

Ocado Group jumped 6.6% to 372.15 pence after the online grocery store operator and technology company reported strong fiscal third quarter results. 

The retail joint venture between Ocado and Marks & Spencer saw an increase in revenue of 15.5% to £658 million for the 13 weeks to September 1.

The company said active customer base increased 10.3% to 1.06 million and average weekly orders rose 14.7% to 437,000.

The company said the number of items per order edged up 0.7% to 44, and the average value of the order held steady at £120.97. 

The company revised its sales outlook to "low double-digit percentage growth" from its previous forecast of "mid-high single-digit growth" in sales in the current fiscal year. 

Close Brothers declined 4.9% to 501.70 pence, and the company said it agreed to sell its wealth management unit, Close Brothers Asset Management, to a private equity firm.