European shares close slightly higher on balance sheets and growth fears

European stocks posted gains on Thursday, supported by some strong quarterly results, while Britain’s FTSE 100 index underperformed its peers after the UK’s central bank raised interest rates at the fastest pace. since 1995.

The pan-European STOXX 600 index closed up 0.2% after a high of 0.3%, reaching a peak in almost two months. The FTSE 100 was stable.

The Bank of England (BoE) raised interest rates by 50 basis points, the strongest rise in 27 years, to 1.75%, despite warning that a long recession is on the way as it rushes to quell rising inflation.

The European Central Bank (ECB) raised interest rates by 50 basis points last month and signaled higher rates ahead.

“As the (eurozone) economy underperforms and interest rates rise, we expect European equity prices to decline over the course of the year,” economists at Capital Economics said in a note.

From the balance sheet crop, Credit Agricole rose 4.7%, joining French lenders BNP Paribas and Société Générale in announcing better-than-expected quarterly earnings amid record highs at its investment banking division.

Lufthansa jumped 6.4%. The company said it expects demand for short-haul flights in Europe to drive growth on its passenger air routes this year, anticipating a return of the group to full-year operating profit.

• In London, the Financial Times index advanced 0.03%, to 7,448.06 points;
• In Frankfurt, the DAX index rose 0.55% to 13,662.68 points;
• In Paris, the CAC-40 index gained 0.64% to 6,513.39 points;
• In Milan, the Ftse/Mib index appreciated by 0.31%, at 22,645.84 points;
• In Madrid, the Ibex-35 index registered an increase of 0.23%, to 8,161.10 points;
• In Lisbon, the PSI20 index rose by 0.10%, to 6,035.88 points.