Stocks slide even as ECB fires 'bazooka'

Oscar Williams-Grut
Senior City Correspondent, Yahoo Finance UK
ECB President Christine Lagarde. (AP Photo/Jean-François Badias)

Stocks fell on Thursday even as the European Central Bank pledged to spend hundreds of billions more helping the eurozone’s economy recover.

The ECB announced €600bn of additional bond buying on Thursday, taking the total committed under the pandemic emergency purchase plan (PEPP) to €1.35tn. The expansion was €100bn more than had widely been expected by the market.

Ulas Akincilar, head of trading at INFINOX, said ECB chief Christine Lagarde was “firing the Euro bazooka”.

“This is Christine Lagarde’s ‘anything it takes’ moment, and the single currency has surged in response to her decisiveness,” he said.

The euro rose 0.6% against the dollar to $1.1313 (EURUSD=X) and 0.5% against the pound to £0.8983 (EURGBP=X).

Stocks had been lower ahead of the announcement but roses sharply following the ECB statement to trade in the green.

However, momentum proved short-lived and most major markets were back in the red by the time US markets opened.

The FTSE 100 (^FTSE) closed 0.6% lower, the DAX (^GDAXI) ended down 0.5% and the CAC 40 (^FCHI) fell 0.2%.

“The ECB seems to have passed the test today but we are still unsure on OPEC’s moves and the ensuing effects on oil prices, which could affect other risk assets,” said Neil Wilson, chief market analyst at, said. “Meanwhile US jobs numbers were disappointing.”

Jobless claims released just before US markets opened showed an additional 1.9m Americans had filed for unemployment benefits over the last week. The number was around 100,000 more than economists had forecast.

The S&P 500 (^GSPC) was down 0.3% by the time European markets shut, while the Dow Jones (^DJI) was flat and the Nasdaq (^IXIC) was down 0.4%.

Overnight in Asia, Japan’s Nikkei (^N225) rose 0.3%, while the Hong Kong Hang Seng (^HSI) slipped 0.2% and the Shanghai Composite (000001.SS) closed down 0.1%.

Elsewhere, the German government agreed overnight to an additional €130bn of fiscal stimulus for its economy late on Wednesday.