European Stocks Fall As Bank Of England Boost Fades; Stoxx 600 Down 1% - Gatous News

European stocks fall as Bank of England boost fades; Stoxx 600 down 1%

Semiconductor shortage set to ease in 2024, Porsche CFO says

Semiconductor shortages will continue to affect Porsche throughout 2023, according to Arno Antlitz, Volkswagen’s chief financial officer, but supply should improve the following year.

“We expect a better supply in 2023, but we expect easing of the shortages only to kick in in 2024,” Antlitz told CNBC’s Annette Weisbach.

The comments were made as Antlitz reflected on Porsche shares making their stock market debut in Frankfurt.

— Hannah Ward-Glenton

Euro zone economic sentiment continues to deteriorate

The European Commission’s economic sentiment indicator, which aggregates business and consumer confidence surveys, fell to 93.7 in September from 97.3 in August, its lowest point since November 2020.

Confidence plummeted across economic sectors amid a broad increase in inflation expectations, despite the European Central Bank’s commitment to interest rate hikes in order to rein in soaring prices.

– Eliot Smith

Porsche shares rise in Frankfurt market debut

Porsche shares increased almost 2% above its IPO price in its stock market debut on Thursday, in what’s being billed as one of Europe’s biggest ever public offerings.

Shares in the luxury carmaker initially traded at 84 euros ($81) at the start of the day.

Shares had been priced at the top end of their range late Wednesday, putting the company value up to 75 billion euros.

Read CNBC’s full coverage here.

— Hannah Ward-Glenton

Stocks on the move: Rational up 12%, Barratt Developments down 9%

Rational shares jumped more than 12% in early trade to lead the Stoxx 600 after the German combi steamer and oven manufacturer raised its sales revenue and profit forecast for 2022.

At the bottom of the European blue chip index, British property developer Barratt Developments fell more than 9%.

CNBC Pro: Analyst says this FAANG stock is an evergreen winner — and investors should buy the dip

Tech stocks have had a difficult year so far but a Rosenblatt Securities analyst thinks the sell-off is an opportunity for long-term investors to buy the dip.

“Stay away from the losers,” he said, recommending “winners in the various secular battles and evolutionary battles” in tech.

Pro subscribers can read more.

— Zavier Ong

Stocks may continue this ‘oversold bounce’ over the next few days, Wells Fargo’s Harvey says

Wells Fargo’s Chris Harvey expects stocks to continue their upward move.

“The spike in short interest, retail selling skew, and BOE’s action all suggest stocks will continue their oversold bounce for the next few days,” he said in a note to clients Wednesday.

Stocks hit fresh lows earlier in the week, with the S&P 500 notching a new bear market. The sell-off was triggered by the Fed’s latest rate decision last week, which some investors believe steered the market into oversold conditions.

As the cost of capital rises and prices hover near record highs, the consensus is increasingly coming to believe that a Fed-induced recession is unavoidable, Harvey said.

“We look at a recession like a car crash,” he wrote. “You never know how bad it will be, but there is almost no ‘better-than-expected’ outcome — so policymakers need to be careful what they wish for.”

— Samantha Subin

10-year Treasury yield drops the most since 2020

The yield on the benchmark 10-year Treasury note dropped the most since 2020 on Wednesday, despite briefly topping 4% earlier in the session, after the Bank of England announced a bond-buying plan to stabilize the British pound.

The 10-year Treasury yield last dropped 23 basis points to 3.733%, or the most it’s dropped since 2020.

It hit a high of about 4.019%, a key level that was the highest since October 2008, earlier in the day before erasing those gains.

Yields and prices move in opposite directions. One basis point is equal to 0.01%.

European markets: Here are the opening calls

European stocks are expected to open in negative territory on Wednesday as investors react to the latest US inflation data.

The UK’s FTSE index is expected to open 47 points lower at 7.341, Germany’s DAX 86 points lower at 13.106, France’s CAC 40 down 28 points and Italy’s FTSE MIB 132 points lower at 22.010, according to data from IG.

Global markets have pulled back following a higher-than-expected US consumer price index report for August which showed prices rose by 0.1% for the month and 8.3% annually in August, the Bureau of Labor Statistics reported Tuesday, defying economist expectations that headline inflation would fall 0.1% month-on-month.

Core CPI, which excludes volatile food and energy costs, climbed 0.6% from July and 6.3% from August 2021.

UK inflation figures for August are due and euro zone industrial production for July will be published.

— Holly Ellyatt

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