On Wednesday, European shares gave up early gains as sluggish German retail sales and weakening factory activity in the euro zone stoked concerns about economic growth in the face of record-high inflation.
After gaining as much as 0.4 percent in early trading, the STOXX 600 index was down 0.3 percent. In May, the benchmark fell 1.6 percent as rising inflation fueled fears of forceful central bank action.
The EU’s stronger-than-expected inflation data released yesterday reignited concerns about how high interest rates could be lifted in general. The main concern is that central bank activities may unintentionally trigger recessions.
Retail sales in Germany declined by more than 5.4 percent in April, according to figures, while manufacturing growth in the euro zone stalled last month due to supply bottlenecks, high costs, and a drop in demand.
The asset manager DWS of Deutsche Bank fell 7% as its CEO announced his resignation next week amid claims that the company misled investors about productive bonds.
Investors were concerned about increasing inflation, central bank policy tightening, and the effect of the Russia-Ukraine crisis; therefore, the STOXX 600 fell for every month this year except March.
Oil prices, which rose over $120 per barrel after European Union officials committed to a temporary and phased ban on Russian oil, have shattered investor optimism that inflation has peaked.
The share market’s price behavior this week reflects the current market’s general instability. China’s commercial capital eased a lockdown on its 25 million residents, allowing some firms, such as banks, to resume operations gradually.
After a string of airline cancellations caused considerable disruption for vacationers, Britain’s Transport Secretary Grant Shapps has urged airlines to cease selling tickets for flights they can’t staff.
Airports across Europe have battled to keep up with the surge in demand, but British airports are in for a particularly tough week as a half-term school holiday coincides with the lengthy Jubilee public holiday weekend.
After two years of COVID-19 travel limitations, airlines had expected a bumper summer for customers. However, following the pandemic’s chaos, they have had difficulty recruiting staff.
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