On Friday, European equities were downbeat, with retail companies under pressure due to worries that the holiday shopping season will be difficult due to rising prices and sluggish global economic growth.
The pan-European STOXX 600 index was unchanged in sporadic morning trading and maintained close proximity to recent three-month highs. Due to Thanksgiving, U.S. markets were closed on Thursday and will have fewer trading hours on Friday.
Black Friday, the beginning of the holiday shopping season, had a 0.3% decline in Europe’s retail index due to the World Cup’s diversion and the rising cost of living. With a 32% decline so far this year, the index is one of the worst-performing sectors in all of Europe.
Related: Ahead of the U.S. Jobs Report, European stock futures go up, and gains in Asia help.
Equities in the real estate industry are down 1.3%, with UK housing stocks leading the way lower as a poll revealed a rise in rental demand in Britain in October as would-be first-time buyers postponed purchases.
Nevertheless, the benchmark STOXX 600 was poised to post gains for a sixth consecutive week, buoyed by indications that the U.S. Federal Reserve would slow the rate at which it raises interest rates as well as a better-than-expected earnings season.
The index has increased by more than 15% from its low point in late September, beating the S&P 500’s 13% rise from its bottom point in October.
“We expect stocks to see less pressure from rate markets as we approach 2023 and transition from inflation to disinflation,” says Emmanuel Cau, European equity strategist at Barclays (LON: BARC).
However, due to a continuing unfavorable growth-policy trade-off and unstable market fundamentals, we advise against projecting the current risk onto the new year.
On Thursday, investors largely ignored the minutes from the European Central Bank’s October meeting, which revealed that policymakers were concerned that inflation might become entrenched and that further rate increases would be necessary.
According to data released on Friday, consumer spending helped the German economy grow somewhat more than earlier estimates indicated in the third quarter.
In terms of individual equities, Credit Suisse fell 1.4% to a record low following this week’s dismal earnings announcement and capital-raising plans.
Related: European stock futures go down because of a Fed rate hike and weak data from China.
Following the European Investment Bank’s loan of 200 million euros ($208.18 million) to the French software company to support its expansion in Europe, OVHcloud saw a 2.1% increase.
