European Stocks Close Notably Lower As Early Rate Cut Hopes Fade

RTTNews | 586 days ago
European Stocks Close Notably Lower As Early Rate Cut Hopes Fade

(RTTNews) - European stocks closed notably lower on Wednesday on concerns about rising inflation in several countries across Europe, and hawkish comments from ECB policymakers, as well as doubts of the Federal Reserve cutting interest rates anytime soon.

Several ECB policymakers have warned that markets are getting ahead on rate cut expectations. Disappointing fourth-quarter GDP data from China hurt as well.

Data from the Office for National Statistics showed UK consumer price inflation picked up unexpectedly in December. The consumer price index rose 4% on a yearly basis, slightly faster than November's 3.9% increase. The rate was forecast to ease to 3.8%.

Month-on-month, the CPI gained 0.4%, offsetting the 0.2% decrease a month ago. Prices were expected to climb 0.2%.

Data from Eurostat showed consumer prices in Eurozone rose 2.9% year-on-year in December, following a 2.4% increase in November. The rate accelerated for the first time since May.

By contrast, core inflation softened to 3.4% from 3.6%. Compared to the previous month, consumer prices rose 0.2% in December, as initially estimated.

The pan European Stoxx 600 dropped 1.13%. The U.K.'s FTSE 100 ended down 1.48%, Germany's DAX drifted down 0.84%, and France's CAC 40 slid 1.07%, while Switzerland's SMI ended 0.72% down.

Among other markets in Europe, Austria, Belgium, Denmark, Finland, Iceland, Netherlands, Norway, Poland, Portugal, Spain and Sweden ended with sharp to moderate gains.

Russia closed higher, while Greece and Turkiye ended flat.

In the UK market, Ocado Group ended nearly 6% down. Glencore, Entain, Land Securities, Endeavour Mining, Barratt Developments, Prudential, Unite Group, Segro, Frasers Group, Fresnillo, National Grid and Anglo American ended lower by 3 to 5%.

Royal Dutch Shell, Marks & Spencer, Schrodders, B&M European Value Retail, Standard Chartered, Airtel Africa, Pearson, Lloyds Banking, AstraZeneca, RightMove and Antofagasta lost 2 to 2.8%.

IMI surged more than 3%. Smith & Nephew and Convatec Group both gained about 1.5%.

In the German market, Zalando ended down more than 5%. Adidas closed lower by about 4.4%. RWE, Sartorius, Puma, Infineon, Vonovia, Mercedes-Benz, BMW, Volkswagen, Siemens Energy, BASF, Henkel and Frsenius Medical Care lost 2 to 4%.

Munich RE climbed 2.7%, and Porsche gained nearly 1.5%. Commerzbank, Allianz and Hannover Rueck also closed notably higher.

In Paris, Kering, Eurofins Scientific, Teleperformance, LVMH, STMicroElectronics, TotalEnergies, Renault, Bouygues, Societe Generale, Unibail Rodamco, Veolia, Saint Gobain, Stellantis and Credit Agricole lost 1.4 to 3.5%.

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