Wednesday , August 10 2022

Unsatisfactory data ended the access rally after helping yesterday from


© Reuters.

By Geoffrey Smith – Well, it won't be long.

European stock markets turned around on Wednesday, as economic announcements in China and Germany quickly dispelled any optimism created on Tuesday by the partial delay of China's new U.S. import tariffs.

The German economy contracted 0.1% in the second quarter, according to previously published preliminary data, which confirms an already evident trend in a series of weak results from trade and industry surveys. Later Eurostat confirmed that growth in the euro area had halved in the second quarter to only 0.2%.

The German figures, marked by a particular weakness in the export sector, only noted the extent of the suffering caused by the slowdown in the Chinese economy, which has been proof all night, with a further slowdown in export growth. retail sales and the lowest industrial output since 2002.

By 12:10, the benchmark was down 0.5% to 370.54, while German was down 0.8% and Italian {{177 | FTSE MIB}} down 1.3%. The 0.3% drop, after stopping 2.1% in July, lowered the probability of an expected rate cut by the Bank of England before leaving the UK. EU, scheduled for end of October.

Steel manufacturers ArcelorMittal (AS 🙂 and Thyssenkrupp (DE 🙂 were the main drivers of these losses, which would face further pressure on prices if Chinese overproduction led to increased exports in world markets. They both fell more than 3.5%.

Banks also suffered from the steady rise in the risk of recession in Europe, which would start a new cycle of imperfect loans after six years in which it was eliminated. In Germany, shares of Commerzbank (DE 🙂 fell 3%, reaching an all-time low, falling below the 5-euro mark. Unicredit (MI 🙂 also lost 3%, while Deutsche Bank (DE :), which was in a merger deal with Commerzbank earlier this year, lost 2.6%.

Chinese sensitive stocks have also been hit hard: the mainland's automobiles have all fallen by more than 1% and suppliers such as Valeo (PA 🙂 and Schaeffler (DE 🙂 fell 2%. Luxury goods brands have also suffered. Swiss groups Richemont (SEX 🙂 and Swatch (SECTION 🙂 experienced a sharp decline as further rise of the Swiss franc ignored the value of their earnings abroad.

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