European Markets in Flux as Inflation Data and Policy Moves Loom

European shares ended slightly lower, driven by losses in defence and industrial sectors, amid rising U.S. inflation and anticipation of France's 2025 budget. The STOXX 600 index fell 0.2%, while German bond yields hit a one-month high. Meanwhile, BPER and GSK stocks saw notable gains.

European stock markets closed on a downturn Thursday, weighed down by losses in defence and industrial sectors as rising U.S. inflation figures stirred investor concerns. The pan-European STOXX 600 index dipped by 0.2%, with some sectors seeing declines of over 1%.

Adding to the uncertainty, the German 10-year bond yield reached a one-month peak, putting pressure on equities. The uptick in U.S. consumer prices, albeit slight, fueled speculation about potential rate cuts by the Federal Reserve in November, as indicated by the CME Group's FedWatch Tool.

On the corporate front, BPER surged 8.2% following a new business strategy for 2024-2027. Meanwhile, GSK's stock rose 3.2% after agreeing to a $2.2 billion settlement over Zantac lawsuits, an amount that was less than analysts anticipated. Deutsche Telekom also saw gains as it forecasted a 4% annual revenue increase through 2027.