European markets fell back on Thursday, after a strong start to the week, ahead of next week's Federal Reserve meeting and the June 23 referendum on Britain's future in the European Union.
During the course of the morning, Ireland and Portugal both released negative inflation figures, although Britain's trade deficit in goods and services with the rest of the world fell to GBP3.3 billion ($4.8 billion) in April, down from GBP3.5 billion in March, due to a weaker pound. Germany also recorded stronger export figures. Its trade balance hit EUR25.6 billion ($29 billion) in May compared to €21.8 billion in April.
In London, the FTSE 100 closed down 1.10% at 6,231.89, while in Paris the Cac 40 slipped 0.97% to finish the day at 4,405.61. In Frankfurt, the Dax tumbled 1.25% to 10,088.87, as the European Central bank's corporate bond buying program ended its second day. Purchase included auto-maker Volkswagen (VLKAF) German tire maker Continental (CTTAY) and the French mobile telephony company Orange (ORAN) , Bloomberg reported at the end of the afternoon, citing a person familiar with the matter.
Stocks fell as government bonds rallied, with the yield on the benchmark 10-year U.K. debt hitting a record low of 1.22%. It was recently down 1 basis points at 1.24%. The yield on the 10-year German bond was recently down 2 basis points at 0.03%. Widespread expectations the Fed will stand pat on rates next week after last week's disappointing jobs data are fueling the rally, as are the ECB's bond buying program and concern about a U.K. "brexit" from the EU.
Sky, (SKYAY) , (BSYBF) , the European broadcaster part-owned by Twenty-First Century Fox (FOX) , shot up 2.9% to score the biggest rise on the London market with the announcement that it has won the rights to the German Bundesliga soccer league through 2021. Sky said the average annual cost will be EUR876 million ($992 million), compared with an average of EUR486 million a year under the existing contract, but that it will retain its place as the "undisputed home of football in Germany."
However, French media conglomerate Vivendi (VIVEF) slipped over 2.3% after regulators blocked a tie-up between its TV channel Canal Plus and Qatari broadcaster Al Jazeera's BeIn Sports.
Danish utility Dong Energy launched what is expected to be one of continental Europe's largest initial public offerings of the year. It priced with an initial market capitalization of 98.2 billion kroner ($15 billion) and a share price of Dkr235. Thursday's opening price on the Copenhagen exchange was already well above the IPO level at Dkr253 and the shares finished the day up 1.2% at Dkr258.
Time Out, the entertainment listings publisher, launched an initial public offering on London's junior AIM market, raising GBP95 million in new money with an offering at 150 pence a share. The shares will start trading next week with an initial market capitalization of £195 million.