European Markets Fall Despite Slowdown in US Inflation

European Stock Indices Decline in Response to US Inflation Data and Corporate News

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Today, European stock exchanges ended the day with a decline in their indices, influenced by the analysis of economic data and corporate messages, reports "Interfax-Ukraine".

The US Department of Labor presented inflation data for November, indicating continued inflationary pressure. The November rise in consumer prices (CPI index) in the US was 3.1% on an annual basis, which is less than the 3.2% in October, but still remains high. Meanwhile, core inflation (Core CPI index), excluding the cost of food and energy, remained at 4%.

The monthly increase in the CPI index in November was 0.1% compared to October, while core inflation (Core CPI) increased by 0.3% against 0.2% in the previous month.

Sima Shah, an analyst at Principal Asset Management, noted that the latest inflation report undermined hopes for a soon reduction in Federal Reserve rates. In her opinion, the slowdown in inflation was insufficient to justify market expectations of a softening in US monetary policy.

The European Stoxx Europe 600 index fell by 0.21%, reaching 472.72 points at the close of trading. Leading national indices also showed a decline: the British FTSE 100 fell by 0.03%, the German DAX - by 0.02%, the French CAC 40 - by 0.11%, the Italian FTSE MIB - by 0.28%, and the Spanish IBEX 35 - by 0.78%.

Data from Germany indicated a decrease in wholesale prices in November by 0.2% month-to-month and by 3.6% annually. The index of economic expectations of investors and analysts in Germany reached a peak since March, rising to 12.8 points. A similar index in the eurozone jumped to 23 points, which is the best result in the last 10 months.

On a corporate level, the British pharmaceutical company AstraZeneca increased its capitalization by 0.8%, thanks to news of the acquisition of the American competitor Icosavax for $1.1 billion.

Renault's securities lost 1% in value after announcing the sale of 5% of Nissan Motor Co. shares, which will lead to an accounting loss of up to 1.5 billion euros. The French energy company TotalEnergies reported a 1.1% decrease in its market value after acquiring three startups in the field of power generation.

Unilever shares fell by 0.2% amid the start of an investigation by the British Competition and Markets Authority regarding possible exaggeration of the eco-friendliness of its products.

Italian Banco BPM, in turn, reported a 1.2% increase in its shares, having published a new strategic plan until 2026. The bank expects to receive 6 billion euros in net profit from 2023 to 2026 and to allocate 4 billion euros for shareholder rewards.

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