Our website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.

European shares inch lower on inflation worries

by Wanda Rich
0 comment

By Susan Mathew

(Reuters) -European shares slipped on Wednesday led by technology stocks, as worries about inflation and monetary policy tightening dampened optimism around China’s economic recovery.

The pan-European STOXX 600 index fell 0.1% by 0820 GMT after rising 3.6% since Friday.

Technology shares slipped 0.7%, while a fall in copper prices weighed on basic material stocks. [MET/L][.L]

Data on Wednesday showed British consumer price inflation hit 9% in April, its highest level on record, inching closer to Bank of England’s prediction of above 10% later this year.

“Worries about recession reared up again after UK inflation jumped to the highest level in 40 years,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Landsdown.

Investors expect the central bank will add to the four interest rate increases it has done since December to tame inflation.

The European Central Bank is set to hike rates in July, and the U.S. Federal Reserve has also embraced policy tightening, raising doubts about its impact on the global economic growth.

“Lots of companies have succeeded in passing high cost to customers, keeping margins resilient. But worries are still lingering about how long consumers will continue to pay the price,” said Streeter.

Shares rallied on Tuesday amid falling COVID-19 cases in China fuelling hopes about more economic activity and demand from the world’s second-largest economy.

The STOXX 600 is in on course to end lower in May, having marked gains only in March this year. But with a 10% decline year-to-date, the index has still fared better than the S&P 500 and MSCI’s All Country index, which are down more than 14% over the same period.

In earnings, Euronext surged 4.7% on record quarterly revenue. Dutch bank ABN Amro topped profit estimates but shares fell 9.3% as it warned about impacts from the war in Ukraine.

Siemens Gamesa jumped 11.2%, after sources said Siemens Energy is preparing to buy the remaining stake in the wind turbine maker. The stake is currently worth 3.14 billion euros ($3.31 billion).

Germany’s Commerzbank AG rose 1.4% after a report that it had scheduled merger talks with Italy’s UniCredit SpA, before the potential deal was shelved due to the Ukraine war. UniCredit shares were unchanged.

Holiday group TUI fell 11.4% after it announced a share sale to pay back elements of a German state bailout it received during the pandemic.

(Reporting by Susan Mathew in Bengaluru; Editing by Rashmi Aich)