European stock markets crept higher, recovering following the previous session’s big losses, with investors absorbing robust U.K. growth, the hawkish ECB position, and the ongoing crisis in Ukraine.
The DAX in Germany was down 0.5%, the CAC 40 in France was unchanged, and the FTSE 100 in the United Kingdom was up 0.7% as of 3:55 a.m. ET (08:55 a.m. GMT).
Data published earlier Friday revealed that Britain’s economy returned far more than predicted in January, with gross domestic product expanding by 0.8 percent on the month following a 0.2 percent decrease in December.
It’s likely that the Bank of England will raise interest rates for a third time in three months at its meeting next week, given these encouraging figures.
The war that has been roiling markets for the last several weeks, with commodity prices and oil, in particular, surging to record highs, failed to produce a truce in negotiations between Russia and Ukraine’s foreign ministers on Thursday, sending European shares dramatically down.
Further actions to penalize Russia are planned on Friday, with the United States, the European Union, and other ally countries preparing to suspend Russia’s “most favored country” trade status. Tariffs on a broad variety of Russian commodities would be possible in this scenario, severely harming the Russian economy.
The Institute of International Finance on Thursday slashed its 2022 Russian GDP growth outlook, predicting Moscow’s economy would fall by approximately 15 percent this year owing to the severity of sanctions, having previously projected a 3 percent growth estimate.
As inflation continues to climb, the European Central Bank (ECB) stunned investors by shifting its tone to one more in favour of tightening monetary policy, declaring the end of all asset purchases by the summer if necessary.
After the second-largest bank in Switzerland, Credit Suisse (SIX:CSGN), announced new goals to roughly reduce its exposure to the financing of emissions from oil, gas, and coal by the end of 2030, the shares of the company gained by 0.4%.
Deutsche Bank (DE:DBKGn) shares jumped 0.5 percent after the German lender stated it paid 14 percent higher in bonuses for 2021, rewarding personnel for the bank’s most successful year in a decade.
Oil prices recovered on Friday but still seemed poised for the worst weekly decrease since November 2021, amid uncertainty about global production levels in a week dominated by speculation of prospective supply increases, especially from the United Arab Emirates, as well as more penalties on Russia.
Oil prices in the United States were slightly higher at $108.68 per barrel by 3:55 am Eastern Time, with the US crude contract up 2.6% to $112.74, while Brent was up 3.1% to $139.13, marking a 14-year high. The US crude contract was set to fall by around 8% this week after reaching a high of $130.50.
A 0.1% decline in gold futures brought the spot price to $1,999.80 an ounce, while the EUR/USD was down 0.1% at 1.0979.
