Europe close: Stocks end on mixed note ahead of ECB

17th Jul 2024 20:47

(Sharecast News) - European shares finished on a mixed note on Wednesday as investors digested the latest UK inflation figures which came in slightly higher than forecast, dampening hopes of a rate cut from the Bank of England.

And the European Central Bank was to announce its own policy decision the next day with some economists wary that it might not go ahead with a September rate cut as anticipated by many.

Against that backdrop, the pan-European Stoxx 600 index was down 0.48% at 514.83, continuing the negative sentiment of recent sessions.

Spain's Ibex 35 meanwhile reversed early losses to trade up by 0.13% to 11,105.20.

Germany's Dax on the other hand gave back 0.44% to 18,437.30.

UK inflation came in at 2% on an annual basis in June, according to official data released by the Office for National Statistics. This was slightly higher than the forecast 1.9%, but in line with the previous month's 2% and the Bank of England's target rate.

Yet according to Dan Coatsworth, investment analyst at AJ Bell, "services inflation still looks too high for comfort.

"The Bank has long said it is data-driven and today's numbers don't look soft enough across the board to convince the policy committee to change gear."

Meanwhile, in the eurozone, inflation fell to 2.5% in June after 2.6% in May, in line with the flash estimate published on 2 July, according to official data published on Wednesday.

Nevertheless, services inflation, which is posing problems for policymakers and their interest rate policies, posted the biggest increase of 4.1 percent, unchanged from May.

In equity news, shares in Adidas were up 2% after the German sportswear company lifted full-year guidance for the second time this year, having beaten expectations with its second-quarter results on Tuesday.

Accelleron Industries spiked 9% as the turbocharging technology firm raised its full-year revenue and profitability guidance after what it called exceptionally larger service orders and revenue growth in the first half of the year.

Demant shares were at the bottom of the Stoxx with a 15% fall after the Danish hearing aid maker cut its full-year outlook, citing a "significant" loss of market share for the managed care brand.

ASML fell 12% on geopolitical concerns and a potential trade war with China, even as the world's largest supplier of chipmaking equipment second-quarter earnings beat expectations.

EssilorLuxottica was down 4% as the eyewear firm said it had signed a deal to buy streetwear brand Supreme from VF Corp $1.5bn in cash.