European stocks stabilize after strong weekly gains

European stocks witnessed stability on Monday after a strong weekly performance that was driven by increased bets on lowering interest rates, while a decline in the health care sector erased the gains of energy sector stocks.

According to Reuters, there was no significant change in the European STOXX 600 index by 0810 GMT, after it jumped by approximately 3% last week. The index is heading towards achieving its first monthly gain since August

After investors’ expectations increased for a 100 basis point cut in interest rates in 2024 and that the first cut would be by April, European Central Bank officials dispelled optimism in the market by indicating that inflation is still high and that the economy is fairly strong.

Energy sector shares rose 0.7%, while health care sector shares fell 0.6% after German pharmaceutical and pesticide company Bayer shares fell 12% to the lowest level in 12 years due to the cancellation of a large trial in the final stages of a new anti-clotting drug.

The shares of the British equipment rental group Ashtead Group fell by 13.5% after the company expected to record annual profits less than expectations and a depreciation cost exceeding two billion dollars during the year.