Stock markets in Europe ended this Wednesday’s session (16) in decline, amid economic and geopolitical uncertainties that promoted a global movement of risk aversion. Speeches by central bankers and other officials were closely monitored by the market.
In Frankfurt, the DAX index fell 1.00%, at 14234.03 points; Paris’ CAC 40 dropped 0.52% to 6607.22 points; the Ibex 35, from Madrid, had a decrease of 0.89, at 8115.40 points; the PSI 20, from Lisbon, fell 0.35%, to 5797.76 points and in Milan, the FTSE MIB fell 0.68%, to 24,531.27 points. Preliminary quotes.
In London, the FTSE 100 closed down 0.25%, at 7351.19 points, after inflation data in the United Kingdom showed the highest annual increase in 41 years, of 11.1% in October.
The figures fueled expectations of further interest rate hikes by the Bank of England (BoE), even as part of the market believes that British inflation may have reached its peak. This early afternoon, BoE President Andrew Bailey said there are signs of inflation slowing down in some items, but further rate hikes are likely to be needed.
The discussion about the pace of interest rate hikes by the world’s main central banks is at the center of the market’s attention. In the US, several members of the Federal Reserve have signaled a slowdown in the magnitude of increases going forward. The European Central Bank (ECB) has also discussed this issue. Today, Ignazio Visco, who in addition to being a member of the ECB is president of the Bank of Italy, said that there is an argument for less aggressive interest rate hikes in the coming months.
Uncertainties regarding the global economic outlook, however, remain quite high. An incident on Tuesday with a missile on Ukraine’s border with Poland has heightened geopolitical tensions. This Wednesday morning, the secretary general of the North Atlantic Treaty Organization (NATO), Jens Stoltenberg, said that there was no “deliberate attack” by Russia on Poland, but blamed Putin for the “illegal war” that provoked such a situation.
The episode boosted actions related to defense and energy in Europe. Shares in oil companies BP and Total rose more than 1%. In the defense segment, the shares of Rheinmetall AG, Thales and Leonardo contradicted the market trend and also rose by more than 2%.
Source: CNN Brasil
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