(Paris) The stock markets sank on Friday before the stronger than expected acceleration of inflation in the United States, which is fueling fears of recession.
Posted at 1:01 p.m.
All of the European indices took a nosedive: Paris (-2.69%), Frankfurt (-3.08%), London (-2.12%). The EuroStoxx 50, the benchmark stock market index in the euro zone, plunged 3.36% during the session and concluded a pitiful weekly balance sheet (-4.88%), the Milanese place even losing more than 5%.
At the time of the close of the European markets, the Dow Jones lost 2.51%, the NASDAQ, 3.57%, while the S&P 500 yielded 2.85%.
“Fears of a further worsening of inflation in the United States in May have proven to be well founded,” comments Timo Emdden, for Emden Research.
Consequence: “investors are increasingly worried about the effects of persistent inflation on corporate profitability and consumer confidence,” observes Michael Hewson, analyst for CMC Markets.
Consumer price inflation accelerated again in May in the United States, after a brief respite in April, and is now at its highest level since December 1981, mainly due to energy prices and feed.
The consumer price index (CPI) in the United States rose by 1% over one month in May, after 0.3% in April. And over twelve months, inflation is galloping to 8.6%, against 8.3% the previous month.
To darken the picture further, U.S. consumer confidence fell in June, after already deteriorating sharply the previous month, touching its lowest level on record, according to the University survey’s preliminary estimate. of Michigan released Friday.
Thursday, the announcements of the European Central Bank (ECB) had already pulled back the stock markets and caused strong tension on the sovereign debt market. The monetary institution had confirmed that it would cease its purchases of bonds in early July on the markets and that it would raise its rates on July 21 by a quarter of a point, as expected.
However, it warned at the same time that a 50 basis point hike could also take place in September if the inflation outlook persists or deteriorates.