European stocks mixed; benign inflation data helps FTSE outperform

European stock markets traded in a mixed manner Wednesday as investors digested more corporate news, while benign inflation data helped the UK markets outperform. 

At 03:05 ET (07:05 GMT), the DAX index in Germany traded 0.2% lower, the CAC 40 in France fell 1%, while the FTSE 100 in the U.K. climbed 0.8%. UK inflation falls to 2021 low

The European day started with some welcome news on inflation, with data showing that headline UK consumer prices fell below the Bank of England’s 2% target in September for the first time since April 2021.

The UK’s inflation rate fell to 1.7% on an annual basis, below the forecast 1.9% and the 2.2% recorded a month earlier.

Core inflation, which excludes volatile food and energy components, also came in below forecast at 3.2%, down from 3.6% previously. 

These numbers added to data earlier in the week that showed British pay grew at its slowest pace in more than two years in the three months to August, suggesting the UK central bank is on track to cut interest rates next month.

Ahead of that, the European Central Bank is also expected to ease monetary policy once more on Thursday, with eurozone business activity unexpectedly contracting in September and inflation falling below the central bank’s target. ASML, LVMH results drive sentiment

In the corporate sector, the European chip sector will be in the spotlight after the region's biggest tech firm ASML (AS:ASML ) released lackluster results earlier than expected late Tuesday.

The computer chip equipment maker forecast lower than expected 2025 sales and bookings on sustained weakness in parts of the semiconductor market. 

The luxury sector will also be in focus after LVMH (EPA:LVMH ) reported late Tuesday a decline in quarterly sales for the first time since the pandemic, as consumer demand in China weakened.

Chinese consumer confidence has slumped back to the all-time lows of the COVID-19 era, said Jean-Jacques Guiony, chief financial officer of the French luxury group.

Stellantis (NYSE:STLA ) stock fell 2% after the carmaker said it expects a 20% yearly drop in consolidated shipments in the third quarter to 1.15 million units globally. Crude steadies after hefty losses 

Oil prices steadied Wednesday after recent sharp losses, amid uncertainty over the situation in the Middle East and concerns over a slowdown in demand growth from top exporter China. 

By 03:05 ET, the Brent contract climbed 0.5% to $74.64 per barrel, while U.S. crude futures (WTI) traded 0.6% higher at $71.04 per barrel.

Both benchmarks plummeted more than 4% in the prior session to a near two-week low after a media report said Israel will not attack Iran’s oil and nuclear facilities, quelling fears of a major escalation in the Middle East. 

Weak economic readings from China also weighed, while both the Organization of Petroleum Exporting Countries and the International Energy Agency cut their demand growth outlooks for 2024 this week.

 

Source: Investing.com