Home ›› 29 Oct 2022 ›› Stock
European shares fell on Friday, knocked by weaker commodity prices and mixed earnings reports, as investors assessed the path for monetary policy tightening amid slowing economic growth.
The pan-European STOXX 600 index fell 0.7%, with miners leading the losses as commodity prices dropped on worries about China’s expanding COVID-19 restrictions.
The benchmark index closed flat on Thursday after the European Central Bank raised interest rates as expected but said “substantial” progress had already been made in its bid to fight off a historic surge in inflation, reported Reuters. “The market reaction suggests that investors interpreted the change in language regarding future interest rate hikes as a dovish signal,” analysts at BCA Research wrote in a note, reported Reuters.
“Indeed, economic conditions warrant a slowdown in the pace of tightening.” Data showed France’s economy eked out meagre growth in the third quarter but a sharp spike in inflation pointed to the headwinds looming in the final quarter of the year.
French blue-chip shares slipped 0.6% after numbers also showed consumer prices in October spiralled to a record high of 7.1% year-over-year.
Another data set showed the German economy grew unexpectedly in the third quarter as Europe’s largest economy staved off the threat of recession for now despite high inflation and concerns over energy supply. Germany’s DAX slipped 0.8%.
