London: Most Asian and European stock markets declined Friday as concerns over inflation, economic growth and virus outbreaks weighed on investors’ minds, dealers said.
Traders digested data confirming eurozone inflation had slowed in June to 1.9 percent from 2.0 percent in May, which suggested that price pressures remain elevated.
In early afternoon eurozone trade, the Frankfurt stock index had dropped by 0.2 percent and Paris was off by 0.6 percent.
London however gained 0.2 percent in late morning deals, aided in part by upbeat quarterly sales from fashion house Burberry.
“European stocks have seen a solid run-up across the (first) quarter, but the momentum behind the rally has stalled recently,” noted Oanda analyst Sophie Griffiths.
“Strong corporate earnings data could go some way to negating the lingering Covid concerns,” she added.
Sentiment was also subdued owing to dovish comments from Federal Reserve chief Jerome Powell, who reiterated the US central bank’s plans to maintain stimulus initiatives until the economy has fully recovered.
Treasury Secretary Janet Yellen meanwhile warned that inflation would remain elevated for months to come.
“I think we will have several more months of rapid inflation, so I’m not saying that this is a one-month phenomenon,” Yellen said Thursday during an interview with CNBC after US markets had closed.
However she predicted that price increases would reach “normal levels” over the medium term.
Wall Street ended with mixed results Thursday, as the Dow closed marginally higher while the other two major indexes retreated.
Asian markets mostly fell on Friday, with Tokyo closing one-percent lower as investors considered expanding Covid-19 infections and the Bank of Japan trimmed its economic growth forecast for the current fiscal year.