By Peter Nurse
Investing.com - European stock markets fell Thursday, weighed by weak sales from brewing giant Anheuser Busch InBev ahead of the release of the latest Eurozone inflation data, which will provide clues about the future path of interest rates in the region.
At 04:10 ET (09:10 GMT), the DAX index in Germany traded 0.4% lower, the CAC 40 in France dropped 0.4% and the FTSE 100 in the U.K. fell 0.1%.
Investors in Europe, as well as the U.S., have become concerned that borrowing costs are set to rise more than previously expected, weighing on future growth, as inflation has proved difficult to tame.
Markets have fully priced in a 50 basis point hike by the European Central Bank in mid-March, and President Christine Lagarde said on a Spanish television show Thursday that interest-rate increases may need to continue beyond the planned half-point move.
This puts a lot of attention on the preliminary Eurozone consumer price index for February later in the session, with median forecasts pointing to an annual figure of 8.2%, a drop from 8.6% the prior month.
However, preliminary data from Germany, France and Spain all came in higher than expected, suggesting potential upside to the Eurozone release.
Also of interest will be the release of the minutes from the ECB’s last policy meeting, as these will provide more clues as to the thinking of the central bank’s policymakers.
In the corporate sector, Anheuser Busch Inbev (EBR:ABI) stock fell 2.2% after the world's largest brewer revealed that sales volumes fell 0.6% from a year earlier in the fourth quarter, the first quarterly decline since the start of the pandemic.
Merck KGaA (ETR:MRCG) stock dropped 0.3% after the German science and technology company warned that core profit will fall in 2023 due to challenges from cost pressures and flagging COVID-19 demand for lab supplies from drug and vaccine makers.
Metro Bank (LON:MTRO) stock fell 2% after the U.K. lender forecast its net interest margin growth will be limited in 2023 as it expects fewer base rate moves and inflationary pressures to outweigh its cost initiatives.
Oil prices edged higher Thursday as traders weighed the prospect of a recovery in Chinese fuel demand against rising crude stockpiles in the United States.
U.S. crude inventories rose by 1.2 million barrels last week to just over 480 million barrels, their highest level since May 2021, the Energy Information Administration reported late Wednesday.
This was the tenth consecutive week of crude stock builds in the United States, and raised questions about demand destruction in the largest consumer of crude in the world.
Chinese manufacturing activity data, also released on Wednesday, had added to evidence of an economic rebound in the world's second largest economy and largest importer of crude.
By 04:10 ET, U.S. crude futures traded 0.4% higher at $77.99 a barrel, while the Brent contract rose 0.3% to $84.54.
Additionally, gold futures fell 0.3% to $1,840.05/oz, while EUR/USD traded 0.3% lower at 1.0638.