It was another day on inflation patrol for investors on Wednesday as stickier-than-expected U.S. data nudged stocks sideways and the dollar up, while a slowdown in Britain’s rate sent the pound sliding.
Wall Street looked set for an early dip after the previous day’s 6.4% U.S. CPI reading, but Europe’s main bourses were moving modestly higher after the equivalent UK inflation rate eased to 10.1% from 10.5%.
That pushed the pound back toward $1.20 versus the dollar and saw the biggest drop in 10-year UK Gilt yields in almost two weeks, albeit after two sizable rises in bond yields globally in the last few sessions.
Oil prices eased again too , as did banks (.SX7P) as a string of problems at one of Britain’s biggest lenders, Barclays (BARC.L), slashed 10% off the value of its shares.
Gucci owner Kering (PRTP.PA) fell as much as 2% after its results, while an 800 million euro buyback and dividend hike lifted Europe’s largest food retailer Carrefour (CARR.PA) up 8% and there were gains of 0.8%-1% in the tech, chemicals and autos sectors. (.SX8P)(.SXAP)(.SX4P)
“Today’s UK inflation data will likely be met with sighs of relief,” Hugh Gimber, a global market strategist at J.P. Morgan Asset Management, said referring to the Bank of England’s interest rate-setting committee.
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