EUROPE MARKETS: Barclays Slumps The Most Since Brexit Vote As FTSE 100 Rises After ECB

By Carla Mozee and Sara Sjolin, MarketWatch Features Dow Jones Newswires

Traders wait for ECB decision at 12:45 p.m. London time

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U.K. stocks closed higher on Thursday, tracking a positive mood across Europe after the European Central Bank extended its bond-buying program and hinted rates will stay low at least until 2019.

Meanwhile, Barclays PLC shares were under pressure following the bank's third-quarter earnings report.

The FTSE 100 index rose 0.5% to end at 7,486.50, partly rebounding from a 1.1% slump on Wednesday (http://www.marketwatch.com/story/lloyds-drags-on-ftse-100-as-investors-focus-on-gdp-2017-10-25).

(http://www.marketwatch.com/story/lloyds-drags-on-ftse-100-as-investors-focus-on-gdp-2017-10-25)ECB in focus:European stocks closed firmly higher (http://www.marketwatch.com/story/european-stocks-cling-to-small-gains-as-investors-brace-for-ecb-move-2017-10-26) with the Stoxx Europe 600 Index up 1.1% and Germany's DAX 30 index scoring an all-time closing high.

The upbeat mood came after the ECB said it would cut its monthly asset purchases to EUR30 billion from currently EUR60 billion, but extend the program by nine months until at least September 2018. The bank also hinted more easing could be in the cards if required, sparking a selloff in the euro. The shared currency fell to $1.1695, down from $1.1813 late Wednesday in New York.

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ECB President Mario Draghi stressed the move wasn't tapering of the quantitative-easing program, but rather a "recalibration" and a "downsizing".

"Today's ECB meeting was played up to be all about tapering, but Mario did what Mario does best, shifting the focus onto an extension," said Joshua Mahony, market analyst at IG, in a note.

"This is a classic case of markets buying the rumor and selling the fact, with today's announcement largely meeting market expectations. Crucially, we are unlikely to see ECB asset purchases end in September 2018, with Mario Draghi ensuring that he is unlikely to ever have to raise interest rates in his role as ECB governor," he added.

Also read:Why Italy faces worst shock in Europe as ECB prepares to taper bond buys (http://www.marketwatch.com/story/why-italy-faces-worst-shock-in-europe-as-ecb-prepares-to-taper-bond-buys-2017-10-24)

Corporates: Shares of Barclays (BCS) (BCS) were whacked down 7.4%, suffering their worst session since June 2016, immediately after the U.K.'s Brexit referendum. That move came as the lender said third-quarter revenue fell 5% (http://www.marketwatch.com/story/barclays-profit-rises-no-word-on-dividend-hike-2017-10-26) to GBP5.17 billion ($6.9 billion) from a year ago, as bond trading revenues slumped. The bank's markets-business revenue fell 30%, but that was somewhat offset by Barclays's U.K. retail and card business. Net-profit rose to GBP583 million.

Read:Barclays stock slumps, wiping GBP2.5 billion off the bank's market cap (http://www.marketwatch.com/story/barclays-stock-slumps-wiping-2-billion-off-the-banks-market-cap-2017-10-26)

Meanwhile, shares of BT Group PLC (BT.A.LN) ended marginally lower after regulator Ofcom said it would cut BT's charges for up to one million landline-only customers (http://www.marketwatch.com/story/bt-to-cut-charges-for-1-million-landline-customers-2017-10-26) following a review.

(END) Dow Jones Newswires

October 26, 2017 12:46 ET (16:46 GMT)