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European Stocks Edge Lower; Lufthansa Returns to Profit

Stock MarketsNov 03, 2021 04:44AM ET
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© Reuters.

By Peter Nurse 

Investing.com - European stock markets edged lower Wednesday in cautious trading ahead of a much-anticipated Federal Reserve meeting, which could see the start of the winding down of pandemic-era monetary stimulus in the world's largest economy.

At 3:45 AM ET (0845 GMT), the DAX in Germany traded 0.1% lower, the U.K.’s FTSE 100 dropped 0.2%, while the CAC 40 in France fell 0.1%. 

The U.S. central bank concludes its two-day policy-setting meeting later Wednesday, and is widely expected to start reining in its $120 million monthly bond-buying program, put in place at the start of the pandemic.

The bigger variable is to what degree Chairman Jerome Powell changes his language on the outlook for inflation which is running at a 30-year high. Admissions that the current spike is set to last for longer than at first thought will likely be taken as a coded warning of earlier interest rate increases.

Back in Europe, Lufthansa (DE:LHAG) stock rose 4.5% after the German airline posted a return to operating profit in the third quarter for the first time since the beginning of the pandemic as restrictions on transatlantic flying were lifted. The airline said it expects to stay profitable at the operating level in the current quarter.

BMW (DE:BMWG) stock climbed 0.9% after the German auto giant reported a sharp rise in third-quarter net profit, as higher prices and strong electric vehicle sales offset lower overall deliveries.

On the flip side, Vestas Wind Systems (OTC:VWDRY) stock slumped over 10% after the Danish wind turbine maker cut its operating margin forecasts citing input cost pressures.  Orsted (OTC:DOGEF), the continent's biggest operator of wind farms, also fell 1.0% after operational numbers that reflected the dramatic drop in wind power output in the third quarter.

German online fashion retailer Zalando (DE:ZALG) stock fell 2.2% as its third-quarter profit fell, while Next (LON:NXT) stock fell 3.2% after the British clothing retailer maintained its full-year profit guidance despite a jump in third-quarter sales. It expects sales growth to slow in the coming months.

In economic news, the main release Wednesday will be the September unemployment rate for the Eurozone, while British house prices rose in October at a faster rate than expected as robust demand, according to a survey by mortgage lender Nationwide.

Crude prices fell Wednesday after an industry report pointed to a sharp rise in oil inventories in the U.S., the largest consumer in the world, and as pressure grows on OPEC+ to increase supply.

The American Petroleum Institute released data late Tuesday which showed U.S. crude stocks rose by 3.6 million barrels for the week ended Oct. 29, more than the 1.5 million barrels that had been expected. The U.S. Energy Information Administration releases its data at 10:30 AM ET.

By 3:45 AM ET, U.S. crude futures traded 2% lower at $82.23 a barrel, while the Brent contract fell 1.8% to $83.19. 

Additionally, gold futures fell 0.3% to $1,783.50/oz, while EUR/USD traded 0.1% higher to 1.1587.

 

European Stocks Edge Lower; Lufthansa Returns to Profit
 

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Cha Nel
Cha Nel Nov 06, 2021 10:09AM ET
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Bientôt je vais la conduire
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Good Once 👍
 
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