Stock markets in Western Europe fall after three days of growth

Stock markets in most of Western Europe closed on Wednesday as stock prices fell after rising for three straight days.

Market participants appreciated the speech of US Federal Reserve Chairman Jerome Powell in the US Senate Banking Committee.

The composite index of the largest companies in the region Stoxx Europe 600 by the close of trading fell by -0.7% to 405.74 points. While the German DAX was down 1.11%, the UK FTSE 100 was down 0.9%, the French CAC 40 was down 0.81%, the Italian FTSE MIB was down 1.4% and the IBEX 35 fell by 1.1%.

Powell said the Fed plans to continue the tightening cycle until it sees clear evidence that US inflation is slowing to its 2% target. “In the coming months, we expect clear signs of a slowdown in inflation,” he added.

“We have the necessary tools and the necessary determination to restore price stability,” he added. Responding to questions from senators, Powell said recession risks “are not particularly high at the moment,” adding that the US economy is strong and consumers and businesses are “in good shape.”

In turn, Democratic Senator from Massachusetts Elizabeth Warren said during the hearing that the Fed needs to ensure that the increase in interest rates does not harm the US economy.

Stock traders also weighed in on UK inflation statistics as UK consumer prices jumped 9.1% in May from the same month last year, according to data from the Office for National Statistics. Inflation has accelerated since April, when it was 9%, and the ceiling has been updated since 1982. The increase in inflationary pressure in the UK is mainly due to rising food and energy prices, including electricity, gas and gasoline.

UK producer prices also rose in May by the most since 1977 on the back of higher commodity prices. The producer price index jumped 15.7% year-on-year after rising 14.7% in the previous month, according to the Office for National Statistics.

The largest drop among Stoxx 600 components was recorded by the German steelmaker Voestalpine AG, which lost 13.1%.

The Belgian company Umicore also sank heavily, falling in price by 8%. Europe’s largest manufacturer of components for electric vehicles has revealed a new development strategy, according to which by 2030 it is planned to double revenue compared to 4 billion euros last year. The company also plans to invest about 5 billion euros in the period 2022-2026.

Source: Interfax

Related Stories