European Markets See Mixed Reactions Amid Fed Rate Cut and Corporate Setbacks
European markets showed a mixed response to the U.S. Federal Reserve's first rate cut since December. The STOXX 600 saw a moderate rise, but SIG's shares took a hit following a profit warning. Meanwhile, Novo Nordisk's study on an obesity pill showed promise, boosting its shares by 2.6%.
On Thursday, European shares experienced a slight uptick as the U.S. Federal Reserve reduced borrowing costs for the first time since December. However, shares of SIG plunged following the Swiss-based company's profit warning announcement.
The pan-European STOXX 600 index increased by 0.5% to reach 553.49 points at 0715 GMT, marking broad-based gains. The interest rate cut by the U.S. central bank was anticipated, serving as the first dovish policy move since December. Despite this, the Fed signaled a cautious approach to further rate cuts, tempering market optimism.
In Denmark, Novo Nordisk's shares rose by 2.6% after new data from a study indicated its experimental Wegovy pill achieved a 16.6% weight loss result, outperforming previous trials of its injectable formulation. Conversely, the SIG Group's shares plummeted by 20%, prompting a trading suspension after issuing a profit warning for 2025 and halting its cash dividend.
(With inputs from agencies.)
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