European stock markets plunge, focus on US inflation

European stock markets plunge, focus on US inflation
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European stock markets are moving in negative territory, following declines in Wall Street and Asian markets, amid fears of uncontrolled inflation that could lead to further monetary tightening in the US. In the first minutes of trading, the Eurostoxx 50 index is down 1.67%. In Frankfurt, the Dax lost 1%, in Paris the Cac40 lost 0.92%, and the Ftse100 in London was down 0.51%.

Inflation will be a top priority today in light of the release of monthly US consumer price data this afternoon, which could accelerate sharply to 8.4% in March (from 7.9% in February). This would be the highest inflation level since January 1982.

“If that is the case (but could be slightly higher), the number would mark another move in favor of a 50 basis point Fed hike at the May meeting,” analysts from Mps Capital Services warn.

Stocks are also reeling from US-China tensions over Covid, with the US State Department ordering all US government officials in Shanghai to leave the city, due to an increase in Covid cases, and at the same time advising US citizens to reconsider any trips to China.

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