Most European stocks slipped on Thursday ahead of the US CPI data. French CAC 40 index declined by 0.26% after weak industrial production figures. Other European stocks like Germany’s DAX index and Euro STOXX 50 each fell by 0.24% and 0.13% respectively. United Kingdom’s FTSE 100 inched higher by 0.33%.
French Economic Concerns
France Industrial Production contracted to 0.1% MoM from the previous 1.0%. It missed the estimated forecast of 0.5%. Manufacturing output slipped 0.3% due to slow production of food products and beverages.
Energy and automakers slipped dragging the CAC 40 index. Automakers fell by 0.1% after recording an uptrend for four consecutive days. oil and gas dropped by 0.9%. mining and quarrying and water supply grew by 1.3%.
French digital music company, Believe, declined by 10.2% in the stock market on Thursday. This was after Spotify and Apple Music which the company has ties with, recorded losses in the stock market.
French Non-farm payrolls remained on a standstill of 0.3%. Payroll employment in the French private sector rose by 88.8 thousand to 19.51 million in this year’s first quarter. More job opportunities were presented with the easing of lockdown restrictions.
Consumer spending also rose as more business reopened. Pubs and restaurants reopened as customers were allowed to dine in enclosed spaces in restaurants. This was a boost in the French economy. It also created more employment opportunities as workers were needed in the running of the businesses.
Investors are now focused on the European Central Bank policy meeting later in the day. The ECB is expected to update its quarterly staff estimates for inflation alongside its interest rate decision. Economists predict that the ECB will likely keep its policy guidance unchanged until the economies fully recover.
According to recent economic data, the Eurozone economy is bound to strongly bounce back in this year’s second quarter. This might bring the ECB to taper its monetary policy.
The CAC 40 index will react to the US CPI data to be released later in the day. According to economists, the core CPI is expected to be at 0.4% MoM. The consumer prices are also expected to rise compared to last year’s. The Federal Reserve is expected to taper its massive stimulus.
CAC 40 Performers
Among the top performers in the CAC 40 index include Arcelor Mittal, STMicroelectronics, and Credit Agricole. Arcelor Mittal recorded a 2.23% gain after announcing its plans to invest €1.45 million in Fos-sur-Mer site to reduce carbon emissions.
STMicroelectronics rose by 2.19% a few days after Ferrari appointed Benedetto Vigna from the company to be their new CEO. On the other hand, Credit Agricole gained 2.07% after announcing a $680.5 million buyback launch.
Some of the companies that lagged include Orange, WFD Unibail Rodamco and Stellantis NV. Each recorded a loss of 2.53%, 3.32% and 1.81% respectively in the stock market ahead of ECB interest rate decision.