European stock markets are on a downward trajectory

European stock markets continue to decline after continuous sign changes in the wake of the latest inflation data in the Eurozone and the United Kingdom.

The central banks’ battle with inflation has been at the center of investment attention amid speculation about the resilience of economies in the context of tightening monetary policy after many years of zero interest rates.

THE Federal Reserve chairman Jerome Powell said yesterday that “what we need to see is that inflation fall in a clear and convincing way,” adding that the US Federal Reserve will continue to push until it sees this decline in inflation. The Fed raised interest rates by 50 basis points in its last session, the largest increase in 20 years, and has planned two more increases of 50 basis points. every time in the summer.

Data released today by Eurostat showed that the annual inflation rate of the euro area was 7.4% in April 2022, stable compared to March. The initial measurement of inflation for April was at 7.5%, with the index still remaining at a high level after the downward revision by the European Statistical Office.

Meanwhile, data released today in the UK showed annual inflation jumping to a 40-year high of 9% in April from 7% in March. The country’s central bank carried out its fourth consecutive rate hike in May, pushing its interest rate to 1%, while markets are expecting further increases in the coming months despite the risk of the British economy slipping into recession.

On the board, the pan-European Stoxx 600 index loses 0.75% to 435.66 points.

The German DAX fell 0.8% to 14,072.41 points, the French CAC 40 lost 0.95% to 6,369.28 points, while the British FTSE 100 fell 0.5% to 7,480.75 points.

In the periphery, the Italian FTSE MIB loses 0.6%, while the Spanish IBEX 35 moves with small gains of 0.1%.

In business developments, the German Commerzbank AG gains more than 1% after reports that the merger talks with the Italian UniCredit were abandoned due to the war in Ukraine.

Shares of Siemens Gamesa jumped more than 11% amid reports that Siemens Energy is preparing to buy the remaining share in the renewable energy company. The value of the share reaches approximately 3.14 billion euros.

From the front of the results, the share of Euronext jumped almost 5% after the announcement of record income for the last quarter, while the Dutch bank ABN Amro, although it managed to exceed the analysts’ estimates, plunged 9% as it warned about the negative impact of the war in Ukraine.