European equities down sharply; UK Retail Sales Slump By Investing.com
By Peter Nurse
Investing.com – European stock markets traded sharply lower on Friday amid renewed fears that aggressive monetary tightening could lead to a global recession.
As of 03:55 ET (07:55 GMT), the in Germany was trading down 1.8%, the in France fell 1.4% and the UK fell 0.4%.
Warnings of an impending global economic slowdown from both the World Bank and the International Monetary Fund hit sentiment on Friday, with Indermit Gill, the World Bank’s chief economist, expressing concern about “widespread stagflation “, a period of low growth and high inflation.
Further evidence of this slowdown emerged on Friday as the UK recorded its biggest drop of the year so far in August, falling 1.6% on the month and 5.4% on the month. year.
The figures were well below analysts’ expectations for a decline of 0.5% on the month and 4.2% on the year and added to the picture of an economy sliding rapidly into recession.
Attention will turn to the August data release, at 05:00 ET (09:00 GMT), which is expected to climb 0.5% on the month, up 9.1% on the year.
The government raised key interest rates by a historic 75 basis points last week and announced more hikes to come as policymakers tried to get the price spike under control.
In corporate news, Uniper (ETR:) stock fell 12% as Germany is poised to take a majority stake in the struggling gas importer, potentially paving the way for full nationalization of the company.
Germany also placed the German subsidiary of the Russian oil giant Rosneft under supervision on Friday, ceding control of the PCK refinery in Schwedt to the federal regulator.
Oil prices stabilized on Friday after heavy losses in the previous session, but were heading for a third consecutive week of losses on fears that aggressive monetary tightening could affect global growth and thus fuel demand.
The crude market was also hit by a sharp rise in the wake of US inflation data, making oil more expensive for buyers using other currencies.
As of 03:55 ET (0755 GMT), futures were trading down 0.2% at $84.97 a barrel, while the contract was up 0.1% at $90.94. Both contracts fell about 4% on Thursday and were expected to lose nearly 2% for the week.
Additionally, it fell 0.8% to $1,663.80 an ounce as it traded down 0.4% to 0.9957.