The main European stock indices ended the day with losses on Thursday, as the international markets have entered a downward spiral due to the fear created by the combination of inflation, rising interest rates and possible recession internationally.
The pan-European index Stoxx 600 It closed with a fall of 1.38%, at 427.98 points, with the food and beverage sector recording a fall of 3.6%, leader of losses, with all major sectors and stock markets in negative territory. The other pan-European index, Eurostoxx 50fell by 1.36%, to 3,640.55 points.
The German DAX lost 0.90%, to 13,882.30 points, with the French CAC 40 to fall 1.26% to 6,272.71 points and the British FTSE 100 to record a fall of 1.82%, at 7,302.74.
On the periphery, the Italian FTSE MIB fell slightly by 0.09% to 24,065.05 points, while the Spanish IBEX 35 “lost” 0.83%, to 8,406 points.
Giants in the retail industry are worried about the coming months as they face huge costs in transporting their products, but also the reduction of purchases by consumers who limit their spending only to the necessary products due to increased prices. In the US, Target Corp’s quarterly earnings were cut in half, while Walmart revised down its forecasts. In Europe, big chains, such as Tesco and Sainsbury’s, have warned of a blow to their gains from the price rally.
Inflation in the US and the UK has climbed to a 40-year high, while in the Eurozone it is setting one record after another amid an unprecedented rally in energy prices due to the war in Ukraine.
At the same time, the sharp turn of central banks from zero interest rates to successive increases to bring frantic inflation under control has sparked serious concerns about the risk of the world’s most advanced economies slipping into recession. Goldman Sachs economists have warned that the US economy is likely to enter a recession in the next two years, estimating a 35% chance.
In Europe, results were announced by Julius Baer and easyJet.
In terms of individual shares, that of HomeServe jumped more than 10%, leader of the Stoxx 600, after the British home repair company agreed to its acquisition by the Canadian Brookfield Asset Management for $ 5 billion.
On the other side of the index, Royal Mail’s share sank by more than 12%, after announcing disappointing results in relation to the estimates, while announcing plans for new spending cuts.