European Stocks Close Broadly Lower On Growth Concerns

European stocks spent much of the day’s session in the red on Wednesday, and although a few markets managed to close in positive territory, the mood remained cautious with a negative bias due to geopolitical concerns, and worries about Chinese demand.

Investors digested regional inflation data and looked forward to the European Central Bank’s rate-setting meeting later in the week for directional cues,

Chinese demand concerns and fears that Donald Trump’s return to the White House would herald more inflation and higher interest rates also weighed on markets.

Semiconductor stocks fell after a report from Bloomberg said President Joe Biden’s administration is considering tougher trade rules against companies in its chip crackdown on China.

The pan European Stoxx 600 ended down 0.48%. Germany’s DAX and France’s CAC 40 closed lower by 0.44% and 0.12%, respectively. The U.K.’s FTSE 100 climbed 0.28%, and Switzerland’s SMI ended 0.6% up.

Among other markets in Europe, Austria, Denmark, Greece, Netherlands, Poland, Portugal and Sweden closed weak.

Belgium, Finland, Iceland, Norway, Russia and Spain ended higher, while Turkiye closed flat.

In the UK market, Burberry Group climbed 4.4%. Smith & Nephew, BT Group, Severn Trent, Reckitt Benckiser, GSK, Vodafone Group, Imperial Brands, United Utilities and Coca-Cola gained 1.5 to 2.5%.

Beazley, Barclays, Standard Chartered, BP, British American Tobacco, Convatec, Croda International, AstraZeneca and Unilever also ended notably higher.

Antofagasta dropped more than 6%. The Chilean miner warned annual production would be at the lower end of guidance.

Intermediate Capital Group ended down 4.7%, while Melrose Industries, Scottish Mortgage, Frasers Group, Rolls-Royce Holdings, Halma, Intertek Group, Weir Group, Relx, Experian, BAE Systems and Anglo American Plc lost 1.4 to 3.3%.

In the German market, BASF, Bayer, Puma and Adidas gained 2 to 3%. Adidas raised its full-year guidance after reporting a 11% increase in revenue during second quarterly of FY24.

Brenntag, Fresenius, E.ON, Sartorius, Henkel, Deutsche Telekom, BMW, Beiersdorf and Deutsche Bank ended higher by 1 to 1.8%.

Rheinmetall fell 5.5%. Siemens Energy lost about 4.4%, while SAP, Siemens, Zalando, Daimler Truck Holding and Symrise ended down 1.3 to 2%.

In the French market, Carrefour climbed nearly 2%. Eurofins Scientific, Air Liquide, Societe Generale, Total Energies, Stellantis, Edenred, L’Oreal, Kering and ArcelorMittal also posted notable gains.

Pernod Ricard climbed 3.4%. The conglomerate has inked a deal to sell its international wine brands to Australian Wine Holdco Limited, a consortium of international institutional investors and owner of Accolade Wines.

Essilor ended more than 4% down. Legrand, Schneider Electric, Accor, Publicis Groupe, Thales, Renault, Michelin and STMicroElectronics lost 0.6 to 2%.

Dutch semiconductor firm ASML Holding tumbled 11% on concerns about more curbs on exports to China.

Danish hearing aid company Demant plummeted 14.8% after a profit warning.

In economic releases, Eurozone consumer price inflation has been finalized at 2.5% year-on-year in June, down from May’s 2.6%. A year earlier, the rate was 5.5%.

U.K. inflation came in unchanged at the official target in June, but the stability of services inflation reduced chances of a rate cut in August.

The consumer price index grew 2% on a yearly basis, the same pace of growth as seen in May, the Office for National Statistics said. Headline inflation was expected to ease to 1.9%.

The chances of an interest rate cut in August diminished a bit more as services inflation steadied at 5.7%.