European stocks fell from a two-week high on Wednesday as investors reacted to the latest euro zone and U.K. inflation data.
Eurostat confirmed that the euro area annual inflation rate was 2.2 percent in August 2024, down from 2.6 percent in July.
The U.K. headline consumer inflation gained 2.2 percent from a year ago in August, the same rate as seen in July, the Office for National Statistics reported.
However, price growth in the services sector picked up, cementing expectations that the Bank of England will pause interest rate cuts on Thursday. Services inflation rose to 5.6 percent from 5.2 percent.
Trading later in the day may be influenced by the much-anticipated Federal Reserve’s decision on interest rates.
The U.S. central bank is likely to deliver the first cut to interest rates in more than four years but there is a debate about the size of reduction after data showed U.S. retail sales unexpectedly ticked up in August in a sign of ongoing consumer resilience.
The pan European STOXX 600 dropped 0.4 percent to 515.20 after rising 0.4 percent on Tuesday.
The German DAX was marginally lower, France’s CAC 40 shed 0.3 percent and the U.K.’s FTSE 100 gave up half a percent.
In corporate news, Danish drug maker Novo Nordisk fell more than 2 percent on a Bloomberg report that its diabetes drug Ozempic is” very likely” to be one of the next drugs targeted for a price cut in the United States.
Italian spirits group Campari plunged 5.2 percent on news that its CEO Matteo Fantacchiotti was resigning with immediate effect after only five months at the helm.
Reckitt Benckiser rose about 1 percent in London. Media reports suggest that the British consumer goods giant has started early discussions with potential suitors for a sale of its homecare assets.
Legal & General Group shares fell 2.5 percent. The financial services company has agreed to sell its U.K. house builder Cala Group for an enterprise value of 1.35 billion pounds ($1.78 billion).
French video games group Ubisoft Entertainment jumped 4.7 percent after BMO Capital Markets raised its rating on the stock to “outperform”.
Nordex SE shares advanced 1.7 percent. The German wind turbine maker said that it has bagged an order for 10 turbines from the wind and solar park developer, Umweltgerechte Kraftanlagen GmbH & Co. KG for an undisclosed amount.
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