LONDON: European stock markets sagged Thursday, as Britain ended a pandemic jobs support scheme and German investors digested disappointing economic data along with post-election uncertainty.
After advancing timidly in the morning, London equities closed 0.3 percent lower as Britain marked the end of its furlough programme and investors shrugged off news that the economy rebounded more than expected in the second quarter.
Frankfurt and Paris also slid back, losing 0.7 percent and 0.6 percent respectively at the close.
On Wall Street, the Dow Jones Industrial Average opened higher, but quickly turned back into the red. The S&P 500 and the tech-heavy Nasdaq were also in negative territory.
“It’s been a strange week so far and that may be feeding into the lack of direction we are seeing across equity markets today,” noted Oanda analyst Craig Erlam.
Oil prices were higher on supply concerns and the dollar steadied after soaring the previous day on hopes of tighter US monetary policy.
Investors remain worried about soaring inflation, the debt crisis at Chinese real estate developer Evergrande and the ongoing global supply crunch. UK car production slumped 27 percent in August from a year earlier, in part due to tight supplies of semiconductors, industry data showed.
The severity of the supply issue was exemplified by carmaker Opel’s announcement Thursday that it will close one of its plants until early 2022 owing to the global microchip shortage that has held back production.
German sentiment remains dogged by fears that talks to form a government will prove long and protracted after Chancellor Angela Merkel’s conservatives lost to the Social Democrats.
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