The Dow Jones Industrial gave up -0.31% to 36'319.98 points at the close. The S&P 500 declined -0.35% to 4'685.25 points. The focus was on the shares of electric car maker Tesla, which slumped almost -12% on Tuesday. Earlier, most European stock indices had also fallen, overall, however, from a high level. The EuroStoxx 50 closed -0.18% lower at 4'344.63 points. In Asia, the stock markets tended to the midweek negative and before this afternoon's consumer price data from the US, the same picture is likely to be expected today on Europe's stock markets.
In China, the price level at the producer level reached its highest level since 1995 in October. In view of the energy shortage and sharply rising coal prices, producer prices (PPI) rose by +13.5% year-on-year (analysts' consensus +12.4%) and thus more strongly than in September (+10.7%).
Producer prices in the United States rose strongly in October. On an annual basis, prices rose by +8.6% at producer level and by +0.6% month-on-month. The price increase was driven by persistently higher transportation costs due to disrupted supply chains, as well as by higher energy and raw material prices. Excluding energy prices, the core rate rose +6.2% in October. The rise in producer prices partially feeds into consumer prices with a time lag and is therefore considered a leading indicator for inflation developments. The latest US consumer prices are eagerly awaited this afternoon.
According to ECB Council member Klaas Knot, the inflation rate in the euro area should fall back below the two percent mark by the end of next year, but the ECB should prepare for a less favorable scenario, he said. From today's perspective, rising inflationary pressures are “largely transitory in nature,” Knot said. However, the driving factors, such as bottlenecks in supply chains or energy price increases, could well be more permanent than previously assumed. The ECB must therefore also prepare for upside scenarios, the Dutch central bank chief said.
The economic expectations of analysts and investors regularly surveyed by the Mannheim-based economic research institute ZEW brightened unexpectedly in November. The expectations barometer increased by 9.4 points to +31.7 points, after the index had previously fallen for five months in succession. The result is significantly better than the consensus expectation of +20.0 points. While the outlook for the German economy is assessed more optimistically, the assessment of the current economic situation clouded over more than expected in November. The survey results for the eurozone mirrored this assessment. According to the ZEW, the financial market professionals surveyed expect supply bottlenecks for raw materials and intermediate products as well as the high inflation rate to continue to weigh on economic development in the current quarter.
|08:00||GE||Consumer Prices (September, y/y)||+4.6%|
|10:00||IT||Industrial Production (September, m/m)||-0.2%|
|14:30||US||Consumer Prices (October, m/m)||+0.4%|
|14:30||US||Consumer Prices (October, y/y)||+5.4%|
|14:30||US||Core Consumer Prices (October, y/y)||+4.0%|
|14:30||US||Initial Jobless Claims||281,000|
|UK||Marks & Spencer||Q3|
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Source: LGT Bank (Switzerland) Ltd.
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