European shares mixed as U.S. inflation data fuels rate cut bets
European stocks closed slightly lower on Wednesday as investors assessed the latest trade news, corporate earnings and inflation data.
The pan-European Stoxx 600 index ended the session down 0.05%. Germany’s DAX slipped 0.39% while France’s CAC 40 was 0.15% higher, even with the country facing widespread protests as its new prime minister was sworn in.
The muted market performance came despite strong gains on Wall Street, with the S&P 500 index at a record high, after a softer-than-expected inflation print cemented expectations for the Federal Reserve to resume interest rate cuts this month.
A series of recent data releases showing signs of a slowdown in the labor market have raised the possibility of the central bank opting for a bigger half-percentage point cut rather than the expected quarter-point reduction.
In Europe, shares of Danish pharmaceutical giant Novo Nordisk closed 3.7% higher after the company announced it would cut around 9,000 jobs.
Elsewhere, Zara owner Inditex gained 6.5% after the company posted its first-half earnings. While the firm’s second-quarter sales were weaker than expected, Inditex said its new Autumn/Winter collections had been “very well received” by customers, with constant currency sales between August 1 and Sept. 7 jumping 9% year-on-year.
In a note sent to clients after the earnings release, Citi strategists said Intidex’ report demonstrated a “meaningful acceleration in current trading.”
“The momentum has improved materially into the first 5wks of [the third quarter],” they said.
European investors also monitored overnight reports that U.S. President Donald Trump asked the EU to hit China and India with tariffs of up to 100% over the countries’ Russia oil purchases. The move seeks to turn up the heat on Moscow to end the war in Ukraine, but risks further destabilizing global trade relations.
Source: CNBC
