European Stocks Slide Ahead of Inflation Data
European stocks dropped on Wednesday as investors awaited the release of inflation data and weighed the impact of rising prices on the region’s economic recovery. The Stoxx Europe 600 Index fell 0.5%, with the benchmark slipping for a third day.
LSE Group Sinks
The London Stock Exchange Group Plc dropped as much as 4.3% after the company said it was in talks to buy Refinitiv, the financial data provider owned by Blackstone Group Inc. The deal could be valued at more than $20 billion, according to people familiar with the matter.
Inflation Data
Investors are awaiting the release of inflation data from the euro area, which is expected to show that prices rose in April. The data could provide clues on the European Central Bank’s next move, as the central bank has said it will keep interest rates low until inflation is close to its target of just below 2%.
Travel Stocks
Travel stocks were among the biggest decliners, with International Consolidated Airlines Group SA dropping 2.3%. The company, which owns British Airways and Iberia, said it expects to lose more than $2 billion this year due to the pandemic.
Retailers
Retailers were also among the biggest decliners, with Marks & Spencer Group Plc dropping 2.2%. The company said it expects to report a loss for the year ending March 2021, as the pandemic has weighed on its sales.
Tech Stocks
Tech stocks were among the biggest gainers, with ASML Holding NV rising 1.7%. The company, which makes semiconductor manufacturing equipment, said it expects to report a record profit for the first quarter of the year.
Oil Prices
Oil prices rose, with Brent crude up 0.7% to $68.25 a barrel. The increase came after the International Energy Agency said global oil demand is expected to rise by 6 million barrels a day this year, the fastest pace since 2010.
U.S. Futures
U.S. stock futures were little changed, with the S&P 500 Index futures up 0.1%. Investors are awaiting the release of the latest U.S. jobs report, which is expected to show that the economy added more than 1 million jobs in April.
Outlook
European stocks have been volatile in recent weeks as investors weigh the impact of rising inflation on the region’s economic recovery. The ECB has said it will keep interest rates low until inflation is close to its target of just below 2%, and investors are watching for signs that the central bank may start to tighten monetary policy. In the meantime, the release of the latest U.S. jobs report could provide further clues on the health of the global economy.