Salem Radio Network News Monday, June 27, 2022

Business

European shares steady at the end of brutal week

(Reuters) -European stocks edged higher on Friday, but were set for sharp weekly losses as a slew of interest rate hikes from major central banks fuelled worries about a sharp economic slowdown.

The pan-European STOXX 600 index rose 0.8% in volatile trade, but was still set for a 4% weekly decline in what could be its worst since early May.

World stock markets were heading for their biggest weekly decline since markets’ pandemic meltdown in March 2020, hit by growing worries about a recession after rate increases in the United States and Britain were followed by a surprise move in Switzerland to quell an inflation surge.

“There is unlikely to be sustained relief from the sinking feeling that has hit financial markets this week,” Susannah Streeter, a senior investment and markets analyst at Hargreaves Lansdown, said in a note.

“The knot of worry about the tricky economic times ahead isn’t likely to go away any time soon.”

The final reading of euro zone inflation for May will be out later in the day.

The STOXX 600 has shed about 17% so far this year on worries over the deteriorating economic outlook and hit to corporate earnings from surging prices and aggressive tightening measures by central banks.

Several regional markets are nearing or have marked a 20% decline from their recent peaks, called a bear market by a commonly used definition.

Among the worst-hit European sectors this week were oil & gas, technology and retail stocks.

For every $100 of inflows since January 2020, there has been zero outflow from stocks, Bank of America said in a weekly note, indicating more pain ahead for equities. Europe has seen outflows for the past 18 weeks.

Among single stocks, Britain’s biggest retailer, Tesco, slipped 0.7% after it said it was seeing early indications of changing customer behaviour due to surging inflationary pressures.

Spanish lender Santander gained 0.5% after it named Hector Grisi as its new chief executive officer, replacing long-time executive Jose Antonio Alvarez.

London-listed miner and trader Glencore gained 3.4% after it forecast half-year adjusted operating profit at its trading division would exceed $3.2 billion, the top end of its long-term annual outlook range.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Subhranshu Sahu)

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