Europe’s main stock market indices are looking for their direction on Wednesday morning. The broad Stoxx Europe 600 index was down 0.4 percent right after ten.
Germany’s DAX and France’s CAC 40 indices came close to Wednesday’s closing readings within the first half hour. The Dutch AEX index was down 0.8 percent at the time of the review.
A Dutch semiconductor company ASML was down 5.2 percent, even though the company reported better-than-expected second-quarter results on Wednesday.
The semiconductor market is overshadowed today by worries about the tightening of geopolitical tensions and possible new export restrictions, the Republican presidential candidate of the United States Donald Trump’s after an extensive Bloomberg interview.
The top losers in the Stoxx Europe 600 index were the Danish hearing aid company, which issued a profit warning Denial (-11.9%) and a Finnish chemical industry company Kemira (-10.2%), which reports today its second quarter results.
In the Stoxx 600 index, the technology sector was clearly the biggest decliner. Sector-wise, energy and consumer product companies were among the most active.
The biggest riser was the Swedish supplier of energy-efficient air handling solutions, which plummeted by nearly 27 percent Cheerswhich reported on Wednesday a result that clearly exceeded expectations.
As for interest rate cuts, keep an eye on the fall
London’s FTSE 100 index was down 0.2 percent after fresh inflation figures dampened expectations for the Bank of England’s next rate cut.
Britain’s June inflation fell short of the previous month’s level of 2.0 percent and thus hit the central bank’s target level for the second time in a row. However, the consensus forecast compiled by Bloomberg had expected it to slow to 1.9 percent.
British core inflation also remained at the previous month’s level of 3.5 percent, when it was expected to slow down gently to 3.4 percent.
The final consumer price index for June in the euro area will be published at noon on Wednesday. According to advance information, inflation slowed to 2.5 percent on an annual basis from 2.6 percent the previous month. According to preliminary data, core inflation was at the level of the previous month at 2.9 percent.
The Council of the European Central Bank will meet in Frankfurt from Wednesday and announce its interest rate decision on Thursday. Market expectations do not include an interest rate cut at the July meeting, but close attention will again be paid to the ECB’s communication around the interest rate decision.
Danish Bank Analyst of interest rate and currency research in Finland Antti Ilvonen expect an unexpected meeting from the ECB.
“Looks are already firmly on autumn, and the market is most likely planning the ECB’s next interest rate cut for September,” states Ilvonen in his market commentary.
“Although there have been no major upheavals in the inflation outlook for the euro area since the June meeting, the US’s optimism about the easing of price pressures has also slightly lowered euro interest rate expectations.”
Source: www.arvopaperi.fi
