Stocks slipped despite solid inflation figures out of China, with European stock markets mostly down on Wednesday. Key earnings reports from companies such as Siemens failed to lift sentiment as investors kept a wary eye on President Trump’s visit to China. Basic resources shares were hit by a decline in industrial metals prices, while optimistic comments from the European Central Bank (ECB) and the European Commission on the growth outlook failed to boost sentiment.
The lackluster session in Europe followed a largely positive close in Asia, which took cues from record levels on Wall Street. The Japanese indices climbed to a 25-year high before a stronger Yen and technical trading hit markets, leaving the Nikkei down -0.20% at the close.
The updated forecasts from the European Commission show that German growth is expected to exceed potential through to 2019, with growth projected at 2.2% this year, 2.1% in 2018, and 2.0% in 2019. However, the ECB believes that the growth is not strong enough and plans to continue injecting funds into the economy next year.
Meanwhile, China’s consumer inflation rose to 1.9% in October, higher than expectations, while prices at the wholesale level surged 6.9% year over year. In the UK, house prices are declining outside of London, with prices falling in the South East, East Anglia, and north-east England, in addition to the capital.
Despite the positive inflation figures out of China, European stock markets struggled to gain momentum amid global economic uncertainties and mixed signals from key financial institutions. Investors remain cautious as they await further developments in the global economy.
