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Title: European Stocks Lower; Sentiment Hit by ECB Tightening Pledge

Jun 10, 2022 03:39AM ET

By: AnalysisWatch

European stock markets fell on Friday as investors digested hints of an interest rate hike by the European Central Bank ahead of the release of key U.S. inflation data.

At 3:40 a.m., Germany's DAX index was down 1.3%, France's CAC 40 down 1.1% and Britain's FTSE 100 down 0.8%.

The European Central Bank confirmed on Thursday that it will end its long-term bond-buying program early next month and said it will raise interest rates by 25 basis points in July and again in September, probably by a larger amount, to combat rising inflation.

The prospect of more aggressive rate hikes this year is weighing on sentiment as the eurozone economy faces slowing growth, exacerbated by the war in Ukraine, and soaring prices.

Germany's central bank, the Bundesbank, cut its growth forecasts for 2022 and the next two years on Friday, saying the war in Ukraine and persistently high inflation will put pressure on Europe's largest economy in the near term.

Shares of Credit Suisse (SIX:CSGN) fell 5.7% after State Street (NYSE:STT) said on Thursday it didn't want to buy the troubled Swiss lender, debunking for the first time reports that it was seeking a deal.

Shares of Just Eat Takeaway rose 4.8% after Bloomberg reported that private equity firms have expressed preliminary interest in the Grubhub unit of the U.S. food-delivery company.

Oil prices fell on Friday as renewed partial shutdowns in China heightened concerns about lower demand from the world's biggest oil importer.

Still, Brent crude posted its fourth straight weekly gain and WTI its seventh weekly gain as global supply shrinks and demand in the U.S., the world's biggest consumer, remains strong.

On Wednesday, both benchmarks reached their highest closing levels since March 8, when they reached their highest levels since 2008.

At 3.40 a.m., U.S. crude futures were down 0.6% at $120.83 a barrel, while the Brent crude contract was down 0.6% at $122.38.

In addition, gold futures fell 0.2% to $1,849.35 per ounce, while the euro/dollar pair rose 0.2% to $1.0634.

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