European stocks retreat on regional growth fears; Just Eat soars

European stock markets retreated Wednesday, with investors concerned about regional growth while digesting more quarterly corporate earnings. 

At 10:05 ET (15:05 GMT), the DAX index in Germany traded 1.1% lower, the CAC 40 in France fell 0.9%, while the FTSE 100 in the U.K. slipped 0.4%. German economy continues to lag 

Investor sentiment is brittle in Europe in the wake of last week's victory by Donald Trump in the US presidential election, given Trump had protectionist trade plans among his key policies, potentially resulting in a trade war just at a time Europe, and Germany in particular, needs all the economic help possible.    

Germany will continue to lag well behind other advanced economies next year, the German Council of Economic Experts said on Wednesday, as it cut its growth forecasts for Europe's biggest economy for 2024 and 2025.

The world's third-largest economy has lagged the European Union average since 2021 and is expected to shrink for the second year running in 2024, making it the worst performer among the Group of Seven rich democracies.

The council, an academic body that advises the German government on economic policy, cut its 2025 growth forecast to 0.4%, down from 0.9% growth in its spring forecasts.

The economic experts also revised their forecast for this year to a 0.1% decline in gross domestic product from growth of 0.2% in their previous forecasts.

There was some potential help Wednesday, as US consumer inflation came in largely as expected, meaning that the US Federal Reserve is likely to continue on its rate cutting path as the year comes to an end.  Allianz reports solid Q3

In the European corporate sector, Allianz (ETR:ALVG ) stock rose 0.3% after the German financial services company reported solid third-quarter results for 2024, surpassing market expectations in key areas of its operations. 

ABN Amro (AS:ABNd ) stock slipped 1.5% after the Dutch lender postponed a decision on potential share buybacks until the second quarter of 2025, even after beating third-quarter profit expectations, driven by sustained improvement of net interest income, and strong performance of fees.

Siemens (ETR:SIEGn ) Energy (ETR:ENR1n ) stock rose 15% after the German energy company decided against proposing a dividend for the 2024 fiscal year, citing limitations to its payout policy as a result of obtaining project guarantees last year that are backed by the German government.

Smiths Group (LON:SMIN ) stock rose 11% after the UK engineering group raised its full-year outlook following its strong first quarter performance. 

Just Eat Takeaway (AS:TKWY ) stock soared 17% after Europe's biggest meal delivery firm struck a deal to sell its U.S. unit Grubhub to Wonder for $650 million.

The Amsterdam-listed firm had been looking to offload Chicago-based Grubhub since as early as 2022, after acquiring it in 2020 in a $7.3 billion all-stock deal. Crude continues to drop

Oil prices fell Wednesday, falling to their lowest in two weeks after OPEC downgraded its global oil demand growth forecasts.

By 10:05 ET, the Brent contract dropped 1.2% to $71.03 per barrel, while U.S. crude futures (WTI) traded 1.4% lower at $67.16 per barrel.

Both contracts had fallen by more than 5% at the start of the week, weighed by the Organization of Petroleum Exporting Countries cutting, in its monthly report on Tuesday, its forecast for world oil demand growth in both 2024 and 2025, mostly due to weakness in China, the world's biggest oil importer.

The International Energy Agency is set to publish its updated forecast on Thursday.

 

Source: Investing.com