Monday, July 22, 2024
Monday, July 22, 2024
Home » European stocks lower on recession fears; Boohoo slumps

European stocks lower on recession fears; Boohoo slumps

by Mitchell Woods
0 comment

European stock markets fell Thursday, following the weaker global sentiment as investors fretted about the possibility of a recession this year.

At 04:10 ET (09:10 GMT), the DAX index in Germany traded 0.8% lower, the CAC 40in France fell 0.7% and the FTSE 100 in the U.K. dropped 0.6%.

This weakness in Europe has tracked the weaker global sentiment, with the blue chip Dow Jones Industrial Average closing over 600 points, or 1.8%, lower on Wednesday, after the release of weak U.S. productionretail sales and producer price data showed the U.S. economy, the main global driver, was contracting. 

Investors have pushed stocks higher recently on the hope that the Federal Reserve, as well as the European Central Bank, won’t have to be as aggressive with interest rates as it was last year as inflation has cooled.

However, policymakers have been keen of late to push back on that sentiment, including Klaas Knot, the current President of the Dutch central bank earlier Thursday.

“I do think that at least until mid year, we will be in tightening mode,” Knot told CNBC in an interview, as underlying inflation in the Eurozone shows no signs of abating.

There’s little in the way of European economic data due for release Thursday, but the ECB publishes the account of its last policy-setting meeting and President Christine Lagarde is due to speak later in the session. 

Both events will be studied carefully for clues of potential future interest rate moves by the central bank.

In corporate news, Boohoo (LON:BOOH) stock fell 5.3% after the U.K.-based fast fashion company stated the outlook for the year ahead is still “uncertain due to macro-economic factors”, expecting revenue to drop around 12% in the current fiscal year.

Deliveroo (LON:ROO) stock rose 0.6% after the food delivery company upgraded its annual core profit margin after elevated prices and cost cutting helped ease the impact from a downturn in orders in the fourth quarter.

Lufthansa (ETR:LHAG) stock fell 0.3% after the German airline offered to buy an initial minority stake in ITA, Italy’s state-owned successor to Alitalia.

Oil prices fell Thursday as weak U.S. economic data and an industry report showing a surprise jump in U.S. crude stocks raised demand concerns over the largest economy in the world.

Data released Wednesday showed a sharp decline in U.S. retail sales and manufacturing output, raising fears of a recession this year.

Additionally, the American Petroleum Institute reported that U.S. oil inventories grew a hefty 7.6 million barrels last week. This would be the second consecutive week of large inventory increases if confirmed by the official numbers from the Energy Information Administration later this session.

By 04:10 ET, U.S. crude futures traded 1.3% lower at $78.74 a barrel, while the Brentcontract fell 1.1% to $84.06. 

Additionally, gold futures rose 0.3% to $1,912.25/oz, while EUR/USD traded 0.3% higher at 1.0819.

You may also like

Soledad is the Best Newspaper and Magazine WordPress Theme with tons of options and demos ready to import. This theme is perfect for blogs and excellent for online stores, news, magazine or review sites. Buy Soledad now!

Vestitor News, A Media Company – All Right Reserved.