European markets were still in the red late Tuesday, following a global sell-off as investors pondered Israel’s potential response to an Iranian missile attack this weekend.
The pan-European Stoxx 600 was down 1.58% at 497.92 points.
Germany DAX was down 1.57% at 17,744.46 points, while French CAC40 The index fell 1.53% to 7,921.97 points.
THE FTSE100 in London experienced a notable decline of 1.82%, ending the day at 7,820.36 points.
In foreign exchange markets, the euro rose 0.09% against the pound sterling, trading at 85.44 pence, while it slipped slightly against the dollar, down 0.02 pence. % to change hands at $1.0622.
“It was another tough day for global markets, and limited gains in the United States are disappearing as traders continue to take risks due to continued uncertainty in the Middle East,” said GI Chris Beauchamp, Chief Market Analyst.
“The threat of an Israeli response to Saturday’s Iranian attacks and yesterday’s strong U.S. retail sales data remain the drivers of this decline.”
Beauchamp said investors had become accustomed to a steady rise in recent months and viewed the indecision in March and April as “digesting” gains before further rise.
“But ultimately, the setbacks we are seeing now are commonplace.
“We’ve moved quickly from ‘greed’ to ‘fear,’ but such declines give investors the opportunity to jump into the recovery at better levels than would otherwise be the case.”
Investor confidence improves in Germany and unemployment rises in the UK
In economic news, investor sentiment in Germany saw a stronger-than-expected improvement this month, according to new survey data.
THE ZEW The economic sentiment gauge jumped to 42.9, marking an 11.2-point increase from March and beating analysts’ forecasts of 35.1.
Furthermore, the assessment of the current economic situation of Europe’s largest economy increased slightly by 1.3 points to -79.2, while a reading closer to -76 was expected.
In the euro area as a whole, the ZEW The economic sentiment indicator climbed 10.4 points to 43.9 in April, reaching its highest level since February 2022 and beating market expectations.
“The recovery of the global economy strengthens expectations for Germany, with half of those surveyed expecting the country’s economy to recover over the next six months,” said Achim Wambach, president of the ‘Germany. ZEW economic institute.
“The significantly improved assessments of the economic situation and expectations in German export destinations also contribute to this increased optimism.”
In the UK, new official data showed a rise in the unemployment rate to 4.2%, accompanied by a notable increase in the number of economically inactive people and a slowdown in hiring by employers.
The total number of unemployed rose by 85,000 in the three months to February to 1.44 million, pushing the jobless rate to its highest level since last summer.
Employment figures also saw a decline, with 156,000 fewer people in work during the quarter, for a total of 32.98 million.
Additionally, the number of economically inactive people increased by 150,000 to 9.404 million, while the number of salaried employees decreased by 67,000 in March to 30.3 million.
Furthermore, regular salaries excluding bonuses recorded growth of 6.0% year-on-year during the same period, down slightly from the 6.1% increase reported for the November-January period by the Office for National Statistics.
Across the Atlantic, data from the U.S. Department of Labor showed that builders launched fewer new housing projects last month than expected.
Housing starts saw a monthly decline of 14.7% in March, reaching an annual rate of 1.321 million, below the consensus estimate of 1.48 million.
Single-family home starts fell 12.4% to 1.022 million.
Permits, considered a leading indicator of housing starts, also saw a decline, falling 4.3% to 1.458 million, below the consensus forecast of 1.514 million.
Ericsson up on first quarter results, Dr Martens tumbles
On the equity markets, the Swedish communications technology company Ericsson rose 1.75% following its first quarter results.
Naturgy Energy Group added 3.36% amid reports of potential acquisition talks with Abu Dhabi’s TAQA.
On the other hand, Dr Martens fell 29.44% after issuing a new profit warning and announcing the departure of CEO Kenny Wilson.
Global payment technology company Wise slipped 9.91%, despite strong adoption of its services in the final quarter of the fiscal year.
British Defense Group QinetiQ was 6.76% weaker at the end of the session, after it said difficult market conditions in the United States continued to impact its global solutions segment.
The departure of CFO Carol Borg also contributed to the negative sentiment surrounding the company.
Reporting by Josh White for Sharecast.com.