European Stocks Close Sharply Lower On Geopolitical Tensions, Growth Worries

(RTTNews) - European stocks closed sharply lower and several markets fell to multi-month lows on Wednesday as worries about Middle East tensions, and inflation concerns offset stronger than expected GDP data from China.

As Gaza ground invasion looms, a huge explosion at a Gaza hospital has derailed the diplomatic efforts led by the U.S. to reduce tensions in the region.

According to reports, a deadly missile attack on Al-Ahli Baptist Hospital in Gaza killed several hundred people including women and children.

Hamas attributed the blast to an Israeli airstrike, but the Israeli military said it was not involved and the explosion was caused by a misfired Palestinian rocket.

The pan European Stoxx 600 declined 1.05%. The U.K.'s FTSE 100 ended down 1.14%, Germany's DAX drifted down 1.03%, and France's CAC 40 lost 0.91%, while Switzerland's SMI shed 1.28%.

Among other markets in Europe, Austria, Belgium, Denmark, Finland, Iceland, Netherlands, Poland, Spain, Sweden and Turkiye closed with sharp to moderate losses.

Greece and Norway ended higher, while Portugal and Russia closed flat.

In the UK market, Persimmon tumbled nearly 7%. AstraZeneca, Barratt Developments, TUI, EasyJet, Taylor Wimpey, Carnival, CRH, Anglo American Plc and Rolls-Royce Holdings lost 3.6 to 5.9%.

IAG, Pennon, Land Securities, British Land Company, Croda International, Mondi, Schrodders, Rio Tinto, Antofagasta, JD Sports Fashion, Segro, Barclays, Natwest and Ferguso also declined sharply.

Reckitt Benckiser, Whitbread, Hiscox and Centrica gained 1.2 to 1.4%.

In the German market, Vonovia, Sartorius, HeidelbergCement, Siemens, Deutsche Bank and Covestro lost 2 to 4%. Fresenius, Merck, SAP, Infineon, Bayer, Siemens Energy and BASF also ended notably lower.

Adidas climbed more than 3% after raising its 2023 revenue guidance. Puma, Hannover Rueck, Zalando and Deutsche Telekom gained 0.6 to 1.5%.

In Paris, Saint Gobain, ArcelorMittal, Schneider Electric, Eurofins Scientific, Unibail Rodamco, Renault, Airbus, Edenred, STMicroElectronics, Bouygues, Vinci, Legrand, Safran and Sanofi lost 1.5 to 4%.

WorldLine rallied 3.2%. TotalEnergies gained about 1%, while Orange and Carrefour posted modest gains.

Swiss stock ABB declined sharply after the engineering group flagged a slowdown in revenue growth in Q4.

On the economic front, UK consumer price inflation remained unchanged in September as the rise in oil prices was offset by the slowdown in food inflation, but this is unlikely to prompt the Bank of England to end the current pause and raise rates further in the November policy session.

The consumer price index, or CPI, posted a steady annual growth of 6.7% in September, the Office for National Statistics reported Wednesday. Economists had expected the rate to ease to 6.6%.

Excluding August 2023 inflation figure, the September rate was the lowest since February 2022.

Core inflation that excludes energy, food, alcoholic beverages and tobacco, slowed to 6.1% in September from 6.2% in August. The rate was seen at 6%.

Eurozone inflation slowed to the lowest level in nearly two years in September after the sharp monetary policy tightening.

The harmonized inflation came in at 4.3% in September, well below 5.2% posted in August, final data from Eurostat showed.

Data from Eurostat showed Eurozone construction output contracted in August, shrinking by 1.1% on a monthly basis, offsetting the 1% gain in July.

On a yearly basis, production in the construction sector slid 0.1%, in contrast to the 1.2% increase in July.

Data showed China's GDP grew at a 4.9% annual pace in July-September, down from 6.3% in the previous quarter but above forecasts for a 4.4% increase.

Retail sales and industrial output figures for September also surprised on the upside, helping ease investor anxiety over the attainability of the official GDP target this year.