European shares ease on energy slump, rate-hike worries

Deliveroo jumped 3.0% after saying the gross value of orders on its platform rose 36% year-on-year in the fourth quarter, resulting in the food delivery company hitting the top of its guidance range with a 70% rise for the year. Metal-cutting tools and mining gear maker Sandvik advanced 0.6% after posting quarterly earnings just above analysts' expectations and noting strong demand.


Reuters | Updated: 20-01-2022 15:56 IST | Created: 20-01-2022 15:36 IST
European shares ease on energy slump, rate-hike worries
Representative Image Image Credit: Piqsels

European shares eased on Thursday as weaker oil stocks and worries over a quicker pace of rate hikes in 2022 offset some quarterly earnings cheer.

The pan-European STOXX 600 was down 0.2%, after rising in the previous session on the back of positive earnings from the luxury goods sector and strong commodity prices. Energy stocks dropped 1.2%, on course for their worst day in a month, as crude oil prices dipped following a month-long rally.

The U.S. Federal Reserve will tighten monetary policy at a much faster pace than thought a month ago to tame persistently high inflation, according to a Reuters poll. Tech stocks, as a result, are set to log their third consecutive week in negative territory.

"Investors are considering the best port of call in a world where money stops sloshing around, and growth stock darlings begin to look less attractive," said AJ Bell financial analyst Danni Hewson. German producer prices rose 24.2% year-on-year in December, with the record annual jump driven by higher energy prices, official data showed on Thursday.

"With the price of oil and gas so high, and consumers under pressure, the threat of even higher prices will be making great big clanging noises in investors' ears," Hewson said. The STOXX 600 has struggled for direction this week as investors worry about soaring inflation and monetary authorities quickening their policy tightening. Positive earnings updates and commodity-linked gains, however, have aided sentiment.

On the upside, Unilever climbed 1.5% on Thursday after abandoning plans to buy GlaxoSmithKline's consumer healthcare business, saying it would not raise its 50 billion pound ($68 billion) offer that GSK previously rejected. Deliveroo jumped 3.0% after saying the gross value of orders on its platform rose 36% year-on-year in the fourth quarter, resulting in the food delivery company hitting the top of its guidance range with a 70% rise for the year.

Metal-cutting tools and mining gear maker Sandvik advanced 0.6% after posting quarterly earnings just above analysts' expectations and noting strong demand. German sportswear maker Puma rose 2% after posting stronger-than-expected preliminary quarterly sales and core profit.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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