Investment accounts
Adult accounts
Child accounts
Choosing Fidelity
Choosing Fidelity
Why invest with us Current offers Fees and charges Open an account Transfer investments
Financial advice & support
Fidelity’s Services
Fidelity’s Services
Financial advice Retirement Wealth Management Investor Centre (London) Bereavement
Guidance and tools
Guidance and tools
Choosing investments Choosing accounts ISA calculator Retirement calculators
Share dealing
Choose your shares
Tools and information
Tools and information
Share prices and markets Chart and compare shares Stock market news Shareholder perks IPOs and placings
Pensions & retirement
Pensions, tax & tools
Saving for retirement
Approaching / In retirement
Approaching / In retirement
Speak to a specialist Creating a retirement plan Taking tax-free cash Pension drawdown Annuities Investing in retirement Investment Pathways
Europe midday: Stocks jump as easing inflation raises hopes of ECB rate cut
(Sharecast News) - Stocks put in decent gains on Tuesday morning after data showed that inflation in the Eurozone eased more than anticipated this month, raising hopes that the European Central Bank (ECB) may loosen monetary policy sooner than expected next year. After a tentative start, markets were building on gains by lunchtime with the pan-European Stoxx 600 index up 0.7% at 434 by 1219 CET.
The single-currency consumer price index (CPI) was up 2.9% on last year in October, significantly down from 4.3% in September. This was the lowest rate in two years and below the 3.1% consensus forecast, on the back of continued energy price deflation and easing food price inflation. Excluding volatile items like food and energy, core inflation slowed to an annual rate of 4.2%, from 4.5% - more or less as expected.
Analysts at Oxford Economics said the drop in core inflation marries with "growing weakness" in demand across the Eurozone, evidenced by Tuesday's GDP figures which showed that the bloc contracted by 0.1% during the third quarter.
"All of this tallies with our assessment of an earlier-than-expected ECB policy pivot. We think the ECB will start with rate cuts already in early Q2 2024. Despite that, we expect headline inflation to dip below target next year."
Analysts at Pantheon Macroeconomics had a similar view, saying that core inflation should fall more quickly than the ECB expects between now and March 2024.
"This, in turn, should be enough for the ECB do lower its forecasts in December and March, and as a result a first rate cut in March," they said. However, they added: "Still-high services inflation and wage dynamics are the main risks to this call."
In other news, retail sales in Germany unexpectedly slumped 0.8% in September, government figures revealed on Tuesday, capping off a weak third quarter for the economy. This was better than the 1.2% decline seen in August but under analysts' expectations of an increase of 0.5%.
BBVA bucks the trend as shares fall
Spanish banking giant BBVA was out of favour despite beating forecasts with a 13% rise in third-quarter net profits to €2.1bn, as it booked a 29% increase in provisions and reported a loss in Turkey.
Sector peers CaixaBank and Bankinter initially fell on negative readacross, but had raced into positive territory by midday.
Italian banks were providing a big lift to the FTSE MIB, which was outperforming other indices with a gain of 1.4%, with Bper Banca, Banca Monte Paschi Siena, Banco Bpm and Intesa Sanpaolo all rising strongly.
In Frankfurt, banking stocks Commerzbank and Deustche Bank were also putting in a decent performance.
Belgian drinks giant AB InBev saw shares jump after reporting a 5% increase in revenue in the third quarter to $15.1bn and a 4.1% rise in EBITDA. The company reiterated its guidance for 4-8% EBITDA growth in the medium term.
In London, BP was down after the oil titan missed profit forecasts for the third quarter. The company reported an underlying replacement cost profit of $3.3bn, an improvement from the $2.6bn recorded in the second quarter but below the $4bn expected by analysts. Shell also fell.
Share this article
Related Sharecast Articles
Important information: This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice. When you are thinking about investing in shares, it’s generally a good idea to consider holding them alongside other investments in a diversified portfolio of assets. Past performance is not a reliable indicator of future returns.
Award-winning online share dealing
Search, compare and select from thousands of shares.
Expert insights into investing your money
Our team of experts explore the world of share dealing.
Policies and important information
Accessibility | Conflicts of interest statement | Consumer Duty Target Market | Consumer Duty Value Assessment Statement | Cookie policy | Diversity and Inclusion | Doing Business with Fidelity | Fidelity gender pay report | Investing in Fidelity funds | Legal information | Modern slavery | Mutual respect policy | Privacy statement | Remuneration policy | Security | Statutory and Regulatory disclosures | Whistleblowing policy
Please remember that past performance is not necessarily a guide to future performance, the performance of investments is not guaranteed, and the value of your investments can go down as well as up, so you may get back less than you invest. When investments have particular tax features, these will depend on your personal circumstances and tax rules may change in the future. This website does not contain any personal recommendations for a particular course of action, service or product. You should regularly review your investment objectives and choices and, if you are unsure whether an investment is suitable for you, you should contact an authorised financial adviser. Before opening an account, please read the ‘Doing Business with Fidelity’ document which incorporates our client terms. Prior to investing into a fund, please read the relevant key information document which contains important information about the fund.
This website is issued by Financial Administration Services Limited, which is authorised and regulated by the Financial Conduct Authority (FCA) (FCA Register number 122169) and registered in England and Wales under company number 1629709 whose registered address is Beech Gate, Millfield Lane, Lower Kingswood, Tadworth, Surrey, KT20 6RP.