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London stocks closed higher on Thursday, buoyed by a better-than-expected GDP reading from the United States. Investor sentiment also turned to the European Central Bank (ECB) as rate-setters opted to maintain interest rates in their latest decision.
At the close, the FTSE 100 edged up by 0.03% to 7,529.73, while the FTSE 250 index showed slightly stronger performance, gaining 0.27% to close at 19,223.10.
In currency markets, sterling experienced a marginal decline of 0.18% against the dollar, trading at $1.2703, while it saw a modest uptick of 0.18% versus the euro, reaching €1.1712.
Market analysts noted the recent attempts by European markets to recover from earlier losses, albeit with gradual progress. Michael Hewson, Chief Market Analyst at CMC Markets, remarked, "The last few days have seen European markets seek to reverse the damage of the early part of last week, but there has been slow progress higher, with the FTSE 100 underperforming relative to its peers."
He further observed, "We opened the session with a modest pullback on the gains of yesterday as markets took stock against a backdrop of disappointing economic numbers, and a reluctance on the part of central banks to consider the prospect of early rate cuts."
Hewson also reflected on the ECB press conference, suggesting a potential dovish shift despite the bank's stance on avoiding early rate cuts: "Today’s ECB press conference may have seen a slight dovish shift in the prevailing narrative here of no early rate cut, although the ECB might seek to deny it."
The market's response underscores the intricate balance between economic data, central bank policies, and investor expectations, shaping the trajectory of financial markets in the current economic landscape.
