European Shares Edge Lower On Inflation Concerns
European stocks gave up early gains to edge lower on Thursday amid concerns over the pace of recent prices increases and the prospect of higher interest rates.
Germany’s producer prices grew at the strongest pace since the series began in 1949, driven by higher energy prices, Destatis reported earlier today, adding to inflation concerns.
Producer prices grew 24.2 percent year-on-year in December, after rising 19.2 percent in November. This was the strongest year-on-year increase since the survey began in 1949 and also exceeded the economists’ forecast of 19.4 percent.
On a monthly basis, producer price inflation advanced to 5.0 percent from 0.8 percent in November. Economists had forecast prices to climb again by 0.8 percent.
The pan European Stoxx 600 was down 0.4 percent at 479.16 after rising 0.2 percent on Wednesday.
The German DAX dropped 0.4 percent, France’s CAC 40 index fell 0.6 percent and the U.K.’s FTSE 100 was down 0.3 percent.
Norway’s Telenor rose half a percent after it had partnered with Amazon Web Services (AWS) to speed up the modernization of its telecoms systems.
Sweden’s Sandvik edged up slightly after reporting earnings and order intake above market expectations.
Unilever added 1.4 percent. The consumer goods giant said it would not raise its rejected 50 billion pound ($68 billion) offer for GlaxoSmithKline’s consumer healthcare business.
Miners fell across the board despite China stepping up its monetary easing efforts by cutting its mortgage reference rate for the first time in nearly two years.
Deliveroo advanced 2.7 percent. The online food delivery company said the gross transaction value (GTV) of orders on its platform rose 36 percent year-on-year in the fourth quarter.
Primark owner Associated British Foods fell 1.5 percent. The company said around 400 jobs are being cut across the fashion chain’s U.K. stores as part of an overhaul of its retail management team.
German sportswear major Puma rallied 1.6 percent after it posted record sales and earnings that topped estimates.
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