FX.co ★ European Shares Slip After UK Inflation Data

European stocks experienced a downturn on Wednesday, driven by uncertainty surrounding future rate decisions and cautious sentiment ahead of Nvidia's earnings announcement.

In the United Kingdom, new data revealed that consumer price inflation decelerated in April, albeit less than anticipated. This development has generated uncertainty regarding a potential rate cut in June. According to the Office for National Statistics, U.K. consumer price inflation fell to its lowest level since July 2021. Specifically, consumer prices increased by 2.3 percent annually in April, a slowdown from the 3.2 percent rise observed in March. Nonetheless, this inflation rate exceeded economists' projections of a 2.1 percent increase.

The pan-European STOXX 600 index declined by 0.3 percent, closing at 521.37, following a 0.2 percent decrease on Tuesday. Germany's DAX and the U.K.'s FTSE 100 both experienced a 0.3 percent drop, while France’s CAC 40 fell by 0.6 percent.

The U.S. dollar saw a slight uptick as investors awaited the release of the Federal Reserve meeting minutes for further clarity on the central bank's monetary policy trajectory.

In corporate developments, Swedish paper company Billerud saw a 2 percent increase in their stock after announcing the cancellation of plans to convert the Escanaba paper mill for cartonboard production. Conversely, Dutch engineering firm Aalberts dropped by 3.7 percent following a 2.5 percent year-on-year decline in organic revenues over the first four months of 2024.

In the U.K., industrial and electrical products provider RS Group's shares fell by 4.2 percent after reporting a 25 percent decline in underlying annual profits. Meanwhile, Marks & Spencer surged by 8.3 percent as the retailer declared its first dividend since 2019, coinciding with its highest profit in over a decade. Additionally, British Land’s stock increased by approximately 2 percent following the sale of its stake in Sheffield's Meadowhall shopping center for £360 million.