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This article is more than 5 year old.

Europe comes under pressure after ECB cuts deposit rate

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Prior to the rate decision, key indexes and individual stocks plummeted, while euro spiked against the dollar, after a tweet by the Financial Times released an ECB update ahead of the announcement.

European equities came under pressure Thursday as investors digested the latest rate decision from the European Central Bank (ECB) and awaited more news from the press conference.

The pan-European STOXX 600 slipped ahead of the presser, down 0.3 percent. All major bourses reversed earlier gains. France's CAC 40 was roughly flat, while Germany's DAX and London's FTSE was down 0.2 percent.

Prior to the rate decision, key indexes and individual stocks plummeted, while euro spiked against the dollar, after a tweet by the Financial Times released an ECB update ahead of the announcement.

Investors are looking ahead to the ECB monetary policy committee meeting on Thursday. The central bank chose to cut its deposit rate to -0.3 percent from -0.2 percent and leaves the main refinancing rate unchanged. The central bank said it would announce further policy measures at the press conference.

Many investors are excepting Mario Draghi to announce some form of an expansion to its bond buying program. The main tweaks bank President Mario Draghi is expected to make are on the size and timetable of the bank's massive 60 billion euro (USD 63.6 billion) a month bond-buying scheme. Or he could possibly a push the deposit rate further into negative territory.

After the rate decision, the euro spiked up as much as 0.8 percent against the U.S. dollar at USD 1.07, before paring gains, to USD 1.06.

On Wednesday, preliminary euro zone  data for November showed that prices rose a lackluster 0.1 percent from the same period a year ago.

Markets are focused on whether the US Federal Reserve will raise rates just as the ECB continues to loosen its monetary policy. Markets will be following comments from Fed Chair Janet Yellen on Thursday as she testifies Thursday morning before the Congressional Joint Economic Committee.

Oil prices jump 2 percent

Oil prices jumped 2 percent or more on Thursday, after a report sourced to a senior OPEC delegate said Saudi Arabia would propose a deal to balance oil markets with help from non-OPEC members in 2016. Brent was up USD 1.06 at $43.55 a barrel while U.S. crude was at USD 40.74, as investors awaited for news from the OPEC meeting this week. Oil and gas stocks however were mixed.

The retail sector was also in focus after brokers released their outlook on some stocks. British retailer Next and Spain's Inditex, the owner of Zara, were trading in a narrow range despite Goldman Sachs raising its price target for the stocks. Sports Direct plummeted 4.5 percent after Goldman put a negative outlook on the stock.

In individual company news, Belgian chemical company Solvay launched a 1.5 billion euros (USD 1.59 billion) share issue to fund part of its USD 5.5 billion acquisition of US-based Cytec. Shares slipped over 1.3 percent on the news.

Anheuser-Busch InBev's shares were down 0.7 percent despite announcing that it was looking to sell SABMiller's premium beer brands to address potential EU antitrust concerns over its acquisition of SABMiller.

Airline Ryanair saw shares in positive territory after it said its traffic grew 21 percent in November.

Shares in Danish jewelry maker Pandora were up 1.3 percent after U.S. retailer Jared said it will upgrade around 200 stores to have Pandora Boutiques within them.

UK agrees to Syria airstrikes

In other news, U.K. politicians voted on Wednesday to join other Western countries in airstrikes in Syria against the militant Islamist group, so-called Islamic State. After more than 10 hours of debate, 397 members of parliament (MPs) voted in favor of airstrikes, 223 against. It was reported that the first U.K. airstrikes were carried out in Syria overnight.

Markets have also been shaken by a mass shooting in San Bernardino in California, in which at least 14 people were killed and as many as 17 wounded.