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European Shares Slip In Choppy Trade On Inflation, Rate Hike Concerns

market trends2 100421 20sep22 lt

European stocks reversed course to edge lower on Tuesday after Sweden's central bank hiked interest rates by a full percentage point to 1.75 percent in a surprise move and data showed German producer prices rose in August at their strongest rate since records began both in annual and monthly terms.

The Executive Board of Riksbank raised the key interest rate by 1 percentage point to 1.75 percent while markets had widely expected a 75 basis-point rate hike.

German producer prices registered an annual increase of 45.8 percent in August, faster than the 37.2 percent rise in July, Destatis reported. The rate was forecast to ease slightly to 37.1 percent.

Energy prices soared 139.0 percent in August from the last year. Excluding energy, producer prices were up 14.0 percent.

On a monthly basis, producer prices gained 7.9 percent, the highest on record, from 5.3 percent in July. Economists had expected inflation to ease sharply to 1.6 percent.

Investors also remained focused on a round of interest-rate decisions by central banks such as the Fed and the BoE this week.

The pan European Stoxx 600 was down 0.3 percent at 406.69, giving up early gains.

The German DAX and France's CAC 40 index both dipped around half a percent, while the U.K.'s FTSE 100 was marginally lower.

Bachem Holding shares jumped 9 percent after the Swiss biotech supplier received large orders for peptides.

Ferrexpo, an iron ore pellet producer, slumped 6.3 percent in London after an adverse court ruling in relation to its purchase of a 40.19 percent stake in Ferrexpo Poltava Mining.

CRH, a global business in building materials solutions, fell about 1 percent after it entered into arrangements with UBS A.G., London Branch to repurchase shares on its behalf for consideration up to $300 million.

Home improvement retailer Kingfisher tumbled 3.5 percent after its first-half profit declined 30 percent.

Henkel AG & Co. KGaA was moving lower despite the German chemical and consumer goods firm raising its sales outlook for fiscal 2022.

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