LONDON (ShareCast) - Europe's leading exchanges remained in the red after the European Central Bank left its key lending rate unchanged at 1% and US jobless figures hit 26-year highs.
The rate decision came in as expected but investors mulled
over Jean-Claude Trichet's comments. Trichet suggested interest rates will remain at a record low for the coming months.
"The current rates are appropriate," Trichet said at the press conference but he refused to rule out further cuts. "We did not decide today that this was the lowest level we would attain under any circumstances."
In other economic news, unemployment in the eurozone rose to a 10-year high of 9.5% in May from 9.3% in the previous month as another 273,000 people lost their jobs in the period.
"Although there are mounting signs that the rate of economic contraction across the Eurozone has moderated substantially since the first quarter and business confidence has risen from the record low levels widely seen in March, this is unlikely to prevent unemployment from rising markedly higher," said Howard Archer, chief UK economist at IHS Global Insight.
Producer prices in the 16-country zone fell 0.2% month-on-month in May and 5.8% on the year.
In the US, another 467,000 people joined the queue for work last month, far more than the 365,000 predicted.
Energy firms were among the main fallers after oil prices backtracked on Wednesday. Royal Dutch Shell (Amsterdam: RDSA.AS - news) , Eni (Milan: ENI.MI - news) and Total were all down, though Repsol (Madrid: REP.MC - news) rose after the Spanish oil major said it had received several offers for a stake in its Argentine unit, YPF.
Across the markets, the French CAC fell 100 point to 3116 with the German DAX slipping 186 points to 4718.
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