European stocks saw mixed results on Tuesday, as investors awaited U.S. inflation data that could potentially influence rate forecasts. The U.S. producer price inflation report, along with Federal Reserve Chair Jerome Powell's conversation with De Nederlandsche Bank President Klaas Knot, are anticipated highlights for the day.
Wednesday's consumer price inflation report is predicted to show a 0.4 percent surge in April, consistent with March's increase. Similarly, Germany's final inflation data for April, provided by Destatis, indicated a steady 2.2 percent inflation rate from March, matching initial flash data from April 29. This is the lowest the country's inflation rate has been since May 2021. Meanwhile, EU harmonized inflation saw a small climb from 2.3 percent to 2.4 percent.
The German ZEW Economic Sentiment Index saw some improvement, from 42.9 in April to 47.1 in May. In the U.K., the pound remained steady as the job market showed signs of slowing down. There was better than expected wage increase in March and a minor rise in unemployment. Employment rates dropped less than predicted, and job vacancies continued to decrease, presenting the Bank of England with further evidence of a cooling labor market and hinting at possible interest rate deductions. The Bank of England's Chief Economist, Huw Pill, stated that considering rate cuts over the summer was "not unreasonable".
The European STOXX 600 saw a marginal increase, ending at 520.87 after a flat yet positive prior day. The German DAX experienced a 0.2 percent drop and France's CAC 40 saw minor decreases, while the U.K.'s FTSE 100 increased by 0.2 percent.
In London, mining company Anglo American's stocks dropped by 2.7 percent following its announcement to divest several assets in a bid to improve its fortunes. Telecommunications operator Vodafone saw a 3.1 percent surge in shares, reporting a 2.2 percent rise in organic earnings for 2024. Flutter Entertainment's stocks fell nearly 2 percent after it reported a larger quarterly net loss.
Meanwhile, French waste and water management company Veolia's shares jumped 2.8 percent after it met first-quarter core profit expectations and secured a $320 million contract for a desalination plant in the UAE. Delivery Hero saw its shares surge 21 percent after Uber Technologies committed to purchasing the company's foodpanda business in Taiwan for $950 million in cash. However, arms manufacturer Rheinmetall suffered a 3.5 percent loss after falling short of sales and profit projections in the first quarter. Despite posting solid results in the first quarter and affirming its 2024 guidance, reinsurer Hannover Re's shares decreased by more than 3 percent.