European shares tumbled on Thursday and most cyclical parts of the market returned to the red, a day after US inflation data stoked concerns about the impact of interest rate hikes on economic growth.
The pan-European STOXX 600 index closed down 0.75% at 424.40 points and gave back much of the midweek gains. Technology, automakers and mining stocks had the sharpest losses among the sectors.
That move comes a day after investors bet on sharper rate adjustments by the US central bank after US consumer prices slowed from a high in April but advanced more than economists’ expectations.
“Rapid wage growth and strong demand could result in sustained rises in services prices, which would force the Federal Reserve to continue raising interest rates even as asset prices stabilize,” said Mark Haefele, chief investment officer. from UBS Global Wealth Management, in a note.
Concerns over tightening monetary policy, economic slowdown in China and rising inflation have intensified recession fears, which have led the STOXX 600 to lose 6.7% so far in May, although first-quarter gains were largely favourable.
- In London, the Financial Times index dropped 1.56%, to 7,233.34 points;
- In Frankfurt, the DAX index fell 0.64% to 13,739.64 points;
- In Paris, the CAC-40 index lost 1.01%, to 6,206.26 points;
- In Milan, the Ftse/Mib index had a devaluation of 0.67%, to 23,566.23 points;
- In Madrid, the Ibex-35 index registered a drop of 1.35%, to 8,200.40 points;
- In Lisbon, the PSI20 index fell by 2.33%, to 5,655.29 points.
Source: CNN Brasil
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