2023-05-31 17:31:41
European stocks
European stocks hit a two-month low on Wednesday, as concerns regarding a global slowdown amid weak economic data from China and uncertainty over a US debt ceiling agreement outweighed optimism over signs of falling inflation in some key euro zone economies.
Luxury goods and automakers linked to their operations in China led losses in sectors in Europe, following data showed that factory activity in the Asian country contracted faster than expected in May due to weak demand.
China is Germany’s main trading partner.
Contrary to the negative data, figures showed that the inflation rate in France fell more than expected in May, and price pressures eased in the German state of North Rhine-Westphalia this month.
Meanwhile, investors are eagerly awaiting the crucial US lawmakers’ vote on an agreement to raise the debt ceiling of the world’s largest economy, a crucial step to avoid an unprecedented default.
House Speaker Kevin McCarthy said, “Within a few hours, the House of Representatives will pass the largest spending cut in history. It’s an important first step to putting the United States on the right track by reforming welfare, getting people back to work, and ending inflation that the Democrats made.” .
markets performance
The pan-European STOXX 600 index closed 1.1 percent lower, following hitting its lowest level since March 30. It also recorded its largest monthly decline this year, which amounted to 3.2 percent, amid concerns regarding facing the debt ceiling and signs of a global economic slowdown.
The German DAX index also posted a 1.4 percent decline in May.
The declines in the index were led by troubled Swedish real estate company SBB, which fell 27.7 percent, as local analysts pointed to a media report regarding possible breaches of loan agreements.
Meanwhile, B&M shares jumped 8 percent following the British retailer expected an increase in core profits for 2024.
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