Europe midday: Shares slip into red; Grifols plunges on Gotham City report

(Sharecast News) - European shares slid into the red at midday on Tuesday as weak economic data from Germany and the UK dampened sentiment, while shares in Spanish drug maker Grifols plunged by almost a third after hedge fund Gotham City queried its debt ratios.

The pan-European Stoxx 600 was down 0.31% at 476.68 with major bourses all down. US and Asian shares were higher overnight.

"The next leg of the interest rate debate will follow later in the week, with the release of the (US) consumer price index reading on Thursday and the producer price index on Friday," said Interactive Investor head of markets Richard Hunter.

"Investors will be keen to see whether there is further progress towards the Fed's 2% stated aim, or indeed whether the last mile towards hitting the target will be the hardest, as some fear."

In economic news, German industrial production registered an unexpected fall in November, making it the six straight month of declines as manufacturing in Europe's biggest economy continued to struggle.

UK Retailers finished 2023 on the back foot, industry data showed on Tuesday, despite a modest uptick in demand in the week leading up to Christmas.

According to the latest BRC-KPMG Retail Sales Monitor, UK total sales increased by just 1.7% in the five weeks to 30 December, compared to a 6.9% rise a year previously.

Eurozone unemployment narrowly surpassed market forecasts in November 2023, according to Eurostat, and was in line with June's historic low.

The seasonally-adjusted jobless rate in the Euro Area hit 6.4% in November, with the number of unemployed individuals falling by 99,000 month-on-month to 10.97m. Meanwhile, the youth unemployment rate, reflecting those under 25 seeking employment, fell to 14.5% from 14.8%.

Across the major Euro economies, Spain reported the highest jobless rate at 11.9%, followed by Italy at 7.5% and France at 7.3%. On the other hand, Germany and the Netherlands reported the lowest rates at 3.1% and 3.5%, respectively.

In equity news, Grifols tanked after Gotham City Research alleged debt ratios were much higher than officially reported, making its shares "uninvestable".

Recruiter Hays tumbled as it warned on profits after a hiring slowdown in December. In an update for the three months to the end of December, the company said group net fees were down 10%, having fallen 15% in December.

As a result, and despite ongoing actions to reduce costs, the recruiter now expects first-half pre-exceptional operating profit of around £60m, which is below consensus expectations of around £73m.

B&M European Value Retail fell despite reiterating its full-year guidance on Tuesday and declared a special dividend, as it posted a 5% jump in third-quarter sales.

Reporting by Frank Prenesti for Sharecast.com