European Stocks Close Lower On Interest Rate Concerns

(RTTNews) - European stocks closed lower on Tuesday amid concerns about interest rates after recent recent jobs data and services sector activity report from the U.S. raised the prospects for more aggressive policy moves by the Federal Reserve.

European Central Bank chief economist Philip Lane said in an interview today that interest rates will need to rise several more times to rein in inflation. He however said, price increases in the euro zone are nearing a peak.

The pan European Stoxx 600 drifted down 0.58%. The U.K.'s FTSE 100 ended 0.61% down, Germany's DAX shed 0.72% and France's CAC edged down 0.14%, while Switzerland's SMI lost 0.76%.

Among other markets in Europe, Austria, Czech Republic, Denmark, Iceland, Ireland, Netherlands, Norway, Poland, Portugal, Russia, Spain and Sweden closed weak.

Turkiye ended notably higher, while Belgium, Finland and Greece ended flat.

In the UK market, Mondi ended 4.7% down following a rating downgrade by Credit Suisse. Scottish Mortgage, Endeavour Mining, Dechra Pharmaceuticals, Halma, ICP, GSK, Fresnillo and F&C Investment Trust lost 2 to 3.1%.

Rolls-Royce Holdings rallied 3.2%. Phoenix Group Holdings gained 2.55% following announcement of incremental new business long-term cash generation target.

Barclays, BAE Systems and Smith (DS) advanced 1.2 to 1.6%.

In the German market, HelloFresh, Fresenius Medical Care, Sartorius, Siemens Healthineers, Adidas, Infineon Technologies and Continental lost 2 to 4%. SAP, Merck and Fresenius also closed sharply lower.

RWE, Munich RE, Zalando and HeidelbergCement posted notable gains.

In Paris, Eurofins Scientific shed about 3.2%. WorldLine, Dassault Systemes, Capgemini, Teleperformance, TotalEnergies, Societe Generale, Stellantis and Alstom lost 1.6 to 2.6%.

Bouygues climbed 1.8%, Carrefour surged 1.5% and Orange gained about 1.1%.

Data released by Destatis today showed factory orders in Germany increased 0.8% month-over-month in October, versus a downwardly revised 2.9% drop in September. Economists had expected factory orders to edge up by 0.1% in the month.

Germany's construction sector deteriorated at the steepest pace in nearly two years in November, primarily due to a sharp fall in housing activity, survey results from S&P Global showed on Tuesday.

The construction Purchasing Managers' Index dropped to 41.5 in November from 43.8 in October. Any reading below 50.0 indicates contraction.

The UK construction sector expanded for the third consecutive month in November, but there was a renewed slowdown in growth amid subdued demand and reduced risk appetite among clients, while rising interest rates and worries over the economic outlook hurt confidence, adding to signs that the economy is in recession.

At 50.4, the construction Purchasing Managers' Index was down from 53.2 in October, signaling the weakest performance since August, survey data from the Chartered Institute of Procurement & Supply, or CIPS, and S&P Global showed Tuesday. However, a reading above 50.0 indicates expansion.