European stocks closed lower on Thursday after two sessions of gains as investors assessed a recent streak bolstered by bets that major central banks would reduce interest rates next year. The Stoxx 600 index closed down 0.2%, with most indices in the region ending the session either stable or slightly lower. The automotive and parts index, as well as the real estate sector, led the losses, each dropping 0.8%. In contrast, the healthcare sector defied the downward trend, rising 0.2%.
The German DAX index fell 0.3% after a survey showed that retail traders' sentiment in Europe's largest economy declined in December, with the holiday shopping season failing to provide any stimulus and bleak forecasts remaining for the coming months. The drop in European stocks on Thursday followed a slide in major Wall Street indexes the previous day, halting a significant global stock winning streak fueled by bets on the Federal Reserve potentially cutting interest rates as early as March.
Investor risk appetite had propelled the Stoxx 600 to an 11-month high last week and brought Italian benchmark bond yields to their lowest levels in 15 months on Thursday. European Central Bank Vice President Luis de Guindos stated on Thursday that it is too early to talk about rate cuts. Shares of Commerzbank rose 1.3% after the bank received approval from the European Central Bank for a share buyback program worth up to €600 million ($656.88 million).
