European Stocks Close Mixed After Slightly Volatile Session

European stocks turned in a mixed performance on Tuesday with investors reacting to the data on U.S. consumer price inflation that showed prices increased by slightly less than expected in the month of August.

The U.S. Labor Department said its consumer price index rose by 0.3% in August after climbing by 0.5% in July. Economists had expected consumer prices to increase by 0.4%.

The somewhat tame U.S. inflation data generated optimism that the Federal Reserve may delay plans to begin scaling back stimulus. However, comments from economists suggest the central bank might begin tapering its asset purchases in December.

The Fed is scheduled to hold a monetary policy meeting next week, with many expecting the central bank to provide an update on the outlook for its asset purchase program.

Investors also tracked the latest set of economic data from the region, and reacted to news from the corporate sector.

The pan European Stoxx 600 edged down 0.01%. The U.K.'s FTSE 100 ended 0.49% down and France's CAC 40 shed 0.36%, while Germany's DAX advanced 0.14% and Switzerland's SMI moved up 0.19%.

Among other markets in Europe, Czech Republic, Denmark, Greece, Netherlands, Russia and Sweden ended higher.

Belgium, Finland, Iceland, Ireland, Norway, Poland, Portugal, Spain and Turkey closed weak, while Austria ended flat.

Luxury stocks were under some selling pressure after new local COVID-19 infections more than doubled in China's southeastern province of Fujian, prompting officials to quickly roll out measures including travel restrictions to halt the spread of the virus ahead of the week-long National Day holiday starting on Oct. 1.

In the UK market, IAG and Evraz both ended more than 4% down. Johnson Matthey, Anglo American Plc, BT Group, BHP Group, Rolls-Royce Holdings, Standard Chartered, Antofagasta and Rio Tinto lost 2 to 3.25%.

HSBC Holdings, Prudential, ICP, 3I Group, Aviva, Burberry Group, Taylor Wimpey and Barclays also ended sharply lower.

JD Sports Fashion Plc shares soared nearly 10% after the athleisure company reported a record first half profit.

B&M European Value Retail, Entain, SSE, Next, Reckitt Benckiser, Kingfisher, Bunzl and Severn Trent gained 1 to 2.3%.

In the French market, Kerring declined 3.25%. Safran also ended more than 3% down. Airbus Group, Credit Agricole, Air France-KLM, Societe Generale, Technip, ArcelorMittal, BNP Paribas, LVMH and Thales shed 1 to 2.4%.

STMicroElectronics, Atos, Faurecia and Dassault Systemes gained 2 to 3.25%. Renault and Capgemini also ended with strong gains.

In Germany, Merck declined more than 3%. Adidas, MTU Aero Engines and Lufthansa also ended notably lower.

Deutsche Post climbed more than 2%. Infineon Technologies, RWE, Siemens, Fresenius and Daimler gained 1 to 1.5%.

Deutz AG shares rallied sharply after the internal combustion engine manufacturer raised its fiscal year 2021 forecast for a second time in 2021.

Shares of world's largest jewelry maker Pandora climbed nearly 7%almost 5 percent after announcing new financial targets.

Swedish automobile chip manufacturer Veoneer drifted lower after confirming that it has received an updated non-binding proposal from Qualcomm.

In economic releases, the U.K. unemployment rate dropped 0.3 percentage points from the previous quarter to 4.6% in three months to July, data published by the Office for National Statistics revealed.

The rate came in line with economists' expectations. At the same time, the employment rate rose 0.5 percentage points to 75.2%.

Switzerland's producer and import prices increased in August, moving up by 4.4% year-on-year, data from the Federal Statistical Office showed on Tuesday.

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