European stocks close mixed, with inflation and ECB minutes on the radar

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The main European stock exchanges closed mixed on Thursday (20), with investors monitoring consumer inflation data in euro area and the producer in Germany. The minutes of the most recent European Central Bank monetary meeting (ECB) was also on the radar.

The pan-European Stoxx600 index rose 0.51% to 483.36 points. The FTSE 100, in London, fell 0.06% to 7,585.01 points.

Chief markets analyst at CMC Markets, Michael Hewson, points out that the index was pressured by Thursday’s energy sector weakness, despite “continued resilience” in oil prices. Royal Dutch Shell and BP shares fell 1.66% and 1.26%, respectively.

On Germany, the producer price index (PPI) reached a record level in December 2021, up 24.2% over the same period.

The HFE says, however, that companies are not passing on high material costs to consumers.

“Some may see this situation as a threat to price stability. We, however, see it as a threat to earnings when firms can no longer delay this pass-through,” analysts say.

In Frankfurt, the DAX rose 0.65% to 15,912.33 points, and in Paris, the CAC 40 rose 0.30% to 7,194.16 points.

I on the euro zone, and inflation (CPI) accelerated to an all-time high of 5% last month on an annual basis. Capital Economics assesses that the index has already reached its peak.

At the most recent ECB meeting, officials considered that a “substantial” level of monetary accommodation is still needed to stabilize the bloc’s inflation at 2% in the long term, minutes showed. ING assesses that the central bank has “woken up” to the uncertainty generated by inflationary pressures.

Capital Economics, on the other hand, points out that there are still significant differences of opinion among members on the rise in prices. Nordea, for its part, maintained its forecast that the ECB will raise its base rate fees only at the end of 2023.

In Milan, the FTSE MIB rose 0.73% to 27,570.00 points, and in Madrid, the IBEX 35 was up 0.45% to 8,814.60 points, according to preliminary data, while the PSI 20 advanced. 0.06%, at 5,663.94 points.

Reference: CNN Brasil

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