European Stocks Close Sharply Lower On Growth Worries

(RTTNews) - European stocks tumbled on Thursday as concerns about inflation and interest rate hikes triggered heavy selling across various sectors in most of the markets in the region.

Stocks suffered their worst quarter since the pandemic-led carnage in early 2020 amid worries about prolonged inflation leading to a global economic downturn.

As several central banks are certain to aggressively tighten their policies in order to combat soaring inflation, investors fear a significant slowdown in global economic growth.

The pan European Stoxx 600 drifted down 1.5%. The U.K.'s FTSE 100 ended lower by 1.96%, while Germany's DAX and France's CAC 40 dropped 1.69% and 1.8%, respectively. Switzerland's SMI slid 0.65%.

Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Finland, Greece, Iceland, Ireland, Netherlands, Norway, Poland, Portugal, Russia, Spain and Sweden all ended weak. Turkey edged up marginally.

Anglo American Plc, Smith (DS), B&M European Value Retail, Scottish Mortgage, Associated British Foods, IAG, Rio Tinto, Land Securities Group, Aviva, Glencore, Standard Chartered and HSBC Holdings lost 3 to 5.3%.

Croda International, Bunzl and Spirax-Sarco Engineering climbed 1.6 to 2%.

In the French market, Societe Generale tumbled more than 6%. Faurecia, Valeo, WorldLine, Air France-KLM, Sanofi, Unibail Rodamco, ArcelorMittal, Engie, BNP Paribas, Veolia, Cap Gemini, Credit Agricole, Bouygues, Renault and STMicroElectronics lost 2.5 to 5.5%.

Sodexo, Thales, Publicis Groupe and Safran posted moderate gains.

In Germany, RWE, Volkswagen, Daimler, Siemens, E.ON and Porsche Automobil declined 4 to 5.3%.

Vonovia, SAP, Infineon Technologies, HeidelbergCement, Deutsche Bank, Continental and HelloFresh lost 2 to 4%. Deutsche Wohnen, Henke, Bayer, Puma, BMW, Allianz and Fresenius Medical Care also ended notably lower.

Siemens Healthineers rallied nearly 2.5%. Zalando, Qiagen, Munich RE and MTU Aero Engines also closed higher.

On the economic front, data from the Office for National Statistics showed U.K. Gross domestic product rose 0.8% from the fourth quarter, in line with the estimate published on May 12. This was slower than the 1.3% expansion seen in the fourth quarter.

UK house price inflation eased more than expected to a six-month low in June, but remained strong overall reflecting the improvement in the labor market, survey results from the Nationwide Building Society showed. The house price index logged a double-digit growth of 10.7% year-over-year in June, slightly slower than an 11.2% rise in May.

Germany's retail turnover recovered in May, with sales growing by real 0.6%, in contrast to a 5.4% fall in April. Economists had forecast a monthly growth of 0.5%.

Germany's import prices grew 30.6% year-over-year in May, slower than the 31.7% rise in April, data from Destatis showed. The expected increase was 31.5%.

The jobless rate in Germany rose to 5.3% in June, the highest since November. The rate was forecast to remain unchanged at 5%.

France's consumer price inflation accelerated at a faster-than-expected pace in June to a new record high, while producer price increase eased slightly in May, flash data from the statistical office Insee showed on Thursday.

EU harmonized inflation rose to 6.5% in June from 5.8% in May, data showed. Economists had forecast inflation to accelerate to 6.3%.

The euro area unemployment rate dropped to a new record low in May, falling marginally to 6.6% in the month, from revised 6.7% in April, figures from Eurostat showed.

Switzerland's retail sales declined for the third straight month in May, falling 1.6% year-on-year, following a revised 5.5% decrease in April, data from the Federal Statistical Office showed.