LONDON — European stocks are expected to fall sharply at the open as global markets digest the latest inflation reading out of the United States. The reading has sparked concerns that a path of aggressive rate hiking lies ahead.
The UK’s FTSE index is seen opening 88 points lower at 7,251, Germany’s DAX 216 points lower at 13,596, France’s CAC 40 down 107 points at 6,150 and Italy’s FTSE MIB down 488 points at 22,953, according to data from IG.
Global investors are digesting the April inflation reading from the US, which showed the consumer price index surged 8.3% in April as compared with a year ago. The inflation rate was higher than expected and still running close to a 40-year high of 8.5%.
Analysts are mixed on whether the data suggests inflation has hit a peak.
The April reading, which represented a slight ease from March’s peak, was also above the Dow Jones estimate for an 8.1% gain. Shares on Wall Street dropped following the data and markets in Asia-Pacific declined in Thursday morning trade following the losses stateside.
US stock futures were slightly higher Wednesday evening as investors look ahead the latest US data on jobless claims and the producer price index, which measures prices at the wholesale level.
In Europe, earnings come from Veolia, Bouygues, Aegon, Allianz, Commerzbank, RWE, Siemens and Zurich Insurance. UK preliminary GDP figures for the first quarter are also due.