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European shares slip after Fed minutes turn hopes for easing policy

By Bansari Mayur Kamdar

(Reuters) – European shares slipped on Thursday, with drugmakers leading losses ahead of euro zone inflation data, while minutes from the Federal Reserve’s December meeting showed central bank Banks work to curb inflation.

Pan-EuropeanSTOXX 23 as of GMT0920 fell 0.2%, having risen more than 3% in the previous three sessions of 2023.

Minutes of Wednesday’s Fed’s December policy meeting showed officials were concerned financial markets were “mistaking” their commitment to fighting inflation was fading, even as they agreed the central bank should slow the pace of monetary policy

AJ Bell analyst Danni Hewson said the market was hoping the minutes would serve as a “blueprint for a turnaround”. “What we got from the Fed minutes was a reality check.”

Healthcare stocks dragged down, pharma giants like Novartis AG and Sanofi (NASDAQ: SNY) fell more than 1 each %.

“The latest news from the WHO that there is no new variant of the virus in China has investors thinking that it will not be as big a return as they expected,” Hewson added.


“Another thing investors worry about is inflation and the cost of living crisis as governments and consumers have to think about where to spend their cash.”

CHINA – Luxury stocks like LVMH and Hermes International (OTC: HESAF) both fell more than 1% as COVID cases rose in the world’s second-largest economy raised concerns about demand.

After a difficult 2008 European stock market started the year on a strong note, supported by economic data showing a milder-than-expected recession and a slowing economy Price pressures in some countries, and hopes of a post-COVID recovery in China.

Investors await producer price data due at 23 GMT for signs of aggressive ECB tightening The influence of cues ning curbs inflation.

British clothing retailer Next rose 7.8% after reporting better-than-expected fourth-quarter sales and boosting its 2008- 23 profit prediction.

The retail sector led gains in early trade, up 2%. Retail stocks were hammered last year, posting their worst annual performance since 2008 as rising interest rates and high inflation weighed on household budgets.

German exports unexpectedly fell in November as high inflation and market uncertainty continued to weigh on Europe’s largest economy even as supply chain problems receded.

Ryanair jumped 5.9% after raising its after-tax profit forecast, citing recent pent-up travel demand, while warning that COVID and the war in Ukraine could still weigh on its performance.

2023 2023


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