European equities mostly fell Thursday with London on tenterhooks before a
painful
UK budget set to rip up the country's economic forecasts.
اضافة اعلان
The British stock market slid 0.6 percent and the pound fell versus the
dollar as finance minister Jeremy Hunt readied a budget that will hike taxes
and slash spending in a bid to balance the books.
In the eurozone, Paris lost 0.5 percent but Frankfurt won 0.2 percent on upbeat
Siemens results, and after a mixed Asian session.
Investors also tracked fresh Russian strikes that hit cities across Ukraine,
having been spooked Wednesday by a deadly missile blast in Poland.
Thursday's focus remains squarely on Britain's announcement which is
scheduled for 1130 GMT.
Traders fear the budget will worsen Britain's cost-of-living crisis after
inflation spiked to a 1981 peak of 11.1 percent, as the economy heads toward
recession.
"Hunt is poised to unveil a raft of spending cuts and tax increases to
plug the estimated £55 billion ($65 billion) fiscal black hole," said
Interactive Investor analyst Victoria Scholar.
"With a recession on the horizon and the 41-year high inflation there
are concerns that we are heading back to an era of austerity and that could add
to the woes facing consumers and businesses," she warned.
The UK government will also give fresh estimates for the country's growth
and inflation.
Elsewhere, Wall Street was hit Wednesday after retailer Target posted weak
results and warned of a poor festive shopping season.
Two reports showing inflation easing in the world's top economy provided a
springboard for world markets over much of the past week as investors took the
readings to mean almost a year of monetary tightening was finally kicking in.
But on Wednesday the commerce department said retail sales jumped far more
than expected last month, suggesting Americans are still able to weather the
higher inflation and interest rate environment.
That was compounded by comments from a top Fed official that she did not see
the bank stopping rate hikes, indicating she was willing to push borrowing
costs above five percent, from the current 3.75 to 4.0 percent.
Traders have for months grown increasingly fearful that the Fed's hawkish
tilt will cause a recession, and policymakers have made clear they are willing
to keep lifting even if that means hurting the economy.
The Bank of England, which is also raising interest rates to combat sky-high
inflation, says Britain is probably already in recession after its economy
shrank in the third quarter and will do so again in the final three months of
2022.
- Key figures
around 1000 GMT -
London - FTSE 100: DOWN 0.6 percent at 7,309.46 points
Paris - CAC 40: DOWN 0.5 percent at 6,573.74
Frankfurt - DAX: UP 0.2 percent at 14,262.63
EURO STOXX 50: DOWN 0.2 percent at 3,876.21
Tokyo - Nikkei 225: DOWN 0.4 percent at 27,930.57 (close)
Hong Kong - Hang Seng Index: DOWN 1.2 percent at 18,045.66 (close)
Shanghai - Composite: DOWN 0.2 percent at 3,115.43 (close)
New York - Dow: DOWN 0.1 percent at 33,553.83 points (close)
Pound/dollar: DOWN at $1.1878 from $1.1914 on Wednesday
Euro/dollar: DOWN at $1.0360 from $1.0395
Dollar/yen: UP at 139.67 yen from 139.54 yen
Euro/pound: FLAT at 87.21 pence
Brent North Sea crude: DOWN 0.4 percent at $92.46 per barrel
West Texas Intermediate: DOWN 0.8 percent at $84.94 per barrel
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