{"id":11912,"date":"2021-07-16T18:09:16","date_gmt":"2021-07-16T18:09:16","guid":{"rendered":"https:\/\/www.pantheregroup.com\/2021\/07\/16\/european-markets-close-weak-on-inflation-concerns-virus-jitters\/"},"modified":"2021-07-16T18:09:16","modified_gmt":"2021-07-16T18:09:16","slug":"european-markets-close-weak-on-inflation-concerns-virus-jitters","status":"publish","type":"post","link":"https:\/\/www.pantheregroup.com\/2021\/07\/16\/european-markets-close-weak-on-inflation-concerns-virus-jitters\/","title":{"rendered":"European Markets Close Weak On Inflation Concerns, Virus Jitters"},"content":{"rendered":"
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Despite staying positive till about noon, European markets<\/span> ended mostly lower on Friday as worries about rising inflation in several countries, and the surge in coronvirus variants hurt sentiment. <\/p>\n

The European Centre for Disease Prevention and Control (ECDC) announced that weekly new COVID-19 cases have increased by 64.3% in the EU and EEA compared with the previous week. The spread is being driven by the more infectious Delta variant, the ECDC said.<\/p>\n

A report from the University of Michigan showing an unexpected slump in U.S. consumer sentiment generated some negative sentiment.<\/p>\n

The report showed the consumer sentiment index slumped to 80.8 in July from 85.5 in June. The decrease surprised economists, who had expected the index to inch up to 86.5.<\/p>\n

One-year inflation expectations jumped to 4.8% in July from 4.2% in June, while five-year inflation expectations inched up to 2.9% from 2.8%.<\/p>\n

The report also showed a notable decrease by the current economic conditions index, which slid to 84.5 in July from 88.6 in June.<\/p>\n

The pan European Stoxx 600 ended down 0.32%. Germany’s DAX declined 0.57%, France’s CAC 40 shed 0.51% and the U.K.’s FTSE 100 edged down 0.06%. Switzerland’s SMI gained 0.42%, bucking the weak trend.<\/p>\n

Among other markets in Europe, Austria, Ireland, Netherlands, Norway, Poland, Portugal, Russia, Spain, Sweden and Turkey closed weak.<\/p>\n

Belgium, Denmark, Greece and Iceland ended higher, while Czech Republic and Finland closed flat.<\/p>\n

Burberry Group shares shed more than 5% despite the company announcing that sales have returned to pre-pandemic levels. <\/p>\n

Glencore and Rio Tinto both ended lower by about 3.5%. Anglo American Plc, Fresnillo, Evraz, Natwest Group, Barclays Group and Weir Group lost 2 to 3%. Lloyds Banking, Antofagasta, BHP Group, Smiths Group, HSBC Holdings, Standard Chartered and BP also ended notably lower.<\/p>\n

DCC, Avast, Rentokil Initial, Reckitt Benckiser, Rolls-Royce Holdings, British American Tobacco, Severn Trent, Whitbread, Unilever, IHG, United Utilities and National Grid gained 1.5 to 2.5%.<\/p>\n

In the French market, Technip shed about 4.7%, ArcelorMittal declined nearly 4% and Societe Generale lost 2.5%. Hermes International, LVMH, BNP Paribas, Renault and Publicis Groupe also ended notably lower.<\/p>\n

Unibail Rodamco, Air France-KLM, Atos, Accor and Veolia gained 1.3 to 3.3%.<\/p>\n

In Germany, Infineon Technologies declined more than 3%. Daimler, Thyssenkrupp, Deutsche Bank, HeidelbergCement, BMW, Volkswagen, Continental, Covestro and Adidas shed 1.2 to 2%, while Lufthansa and Vonovia ended with strong gains.<\/p>\n

In the Swedish market, Swedbank shares rose sharply after the lender reported better-than-expected second quarter results.<\/p>\n

Shares of telecom equipment maker Ericsson slumped more than 9% after the company’s second-quarter core earnings came in below expectations. <\/p>\n

In economic releases, Eurozone inflation fell below 2% in June, as initially estimated, final data from Eurostat showed. Inflation eased to 1.9% in June from 2% in the prior month. The annual rate came in line with the flash estimate released on June 30.<\/p>\n

The inflation rate had exceeded the European Central Bank’s target of “below, but close to 2% in May for the first time since 2018.<\/p>\n

On a monthly basis, the harmonized index of consumer prices gained 0.3% in June.<\/p>\n

Separately, Eurostat data revealed that the euro area trade surplus declined in May on weak foreign demand.<\/p>\n

The trade surplus fell to a seasonally adjusted EUR 9.4 billion in May from EUR 13.4 billion in April. Exports dropped 1.5% on a monthly basis in May, while imports grew 0.7%.<\/p>\n

On an unadjusted basis, the trade balance showed a surplus of EUR 7.5 billion in May compared to EUR 8.9 billion surplus in the same period last year.<\/p>\n

Europe’s passenger car registrations increased at a moderate pace in June, data from the European Automobile Manufacturers’ Association, or ACEA, showed on Friday.<\/p>\n

Car registrations increased 10.4% year-on-year in June, but slower than the 53.4% growth posted in May.<\/p>\n

Among the major EU car markets, Germany posted the biggest gain with a 24.5% increase. Sales in Spain were up 17.1% and that in Italy advanced 12.6%. In France, by contrast, passenger car sales contracted 14.7%.<\/p>\n

Over the first half of 2021, EU demand for new cars grew by 25.2% and sales reached almost 5.4 million units. However, this was still 1.5 million units below the pre-COVID volume recorded over the first six months of 2019. <\/p>\n<\/p>\n

Market Analysis<\/p>\n<\/div>\n