European stocks struggle for direction; UK economy contracted in September

European stock markets struggled for direction Friday, as investors digested disappointing UK growth data, French inflation numbers as well as hawkish comments from Fed chair Jerome Powell. 

At 04:40 ET (09:40 GMT), the DAX index in Germany traded largely flat, while the CAC 40 in France fell 0.1% and the FTSE 100 in the U.K. dropped 0.1%. UK economy contracted in September 

Britain's economy contracted unexpectedly in September, data showed on Friday, as gross domestic product slipped by 0.1% in monthly terms during September.

For the third quarter as a whole, the economy grew by 0.1%, slowing from 0.5% growth during the second quarter, and below the 0.2% expansion the Bank of England had forecast.

This followed data released on Thursday showing the eurozone grew only 0.4% in the third quarter, with the bloc’s largest component - the German economy - particularly weak.

Additionally, consumer prices in France, the eurozone’s second-biggest economy, rose 1.6% year-on-year in October, revising slightly up its preliminary reading of 1.5% published late last month.

Also weighing were relatively hawkish comments by Jerome Powell , with the Fed chairman signaling on Thursday that the US central bank doesn’t need to rush to cut interest rates further, especially given the uncertainty surrounding the return of President-elect Donald Trump to the White House. Evotec soars on potential purchase

In the European corporate sector, Evotec (ETR:EVTG ) jumped almost 20% after Halozyme Therapeutics (NASDAQ:HALO ) said it has proposed buying the German drug developer.

European vaccine makers also came under pressure, with Sanofi (NASDAQ:SNY ) down 4.4% and GSK (LON:GSK ) 3.8% lower, after Trump selected Robert F. Kennedy Jr., a vaccine skeptic, to lead the Department of Health and Human Services. Crude prices hit by demand concerns 

Crude prices fell Friday, and were on track for hefty weekly losses on concerns that China, the world's biggest crude importer, is continuing to struggle with an uneven economic recovery.

By 04:40 ET, the U.S. crude futures (WTI) dropped 1.3% to $67.81 a barrel, while the Brent contract fell 1.2% to $71.69 a barrel.

For the week, both contracts are set to drop around 3%.

Economic data released earlier in the session had painted an uncertain picture of the Chinese economy, while the numbers also indicated that China's oil refiners in October processed 4.6% less crude than a year earlier, falling year-on-year for a seventh month.

Prices were rattled by a cut in OPEC’s demand outlook this week, while US oil inventories grew nearly 2.1 million barrels in the week to November 8, pushing up concerns over a supply glut, especially as US production remained close to record highs of over 13 million barrels per day. 

The International Energy Agency, in its monthly report on Thursday, had warned that robust production will see oil supplies exceed demand in 2025, even if the Organization of Petroleum Exporting Countries, and allies, left ongoing supply cuts in place. 

 

 

Source: Investing.com