European stocks closed lower

Brussels — European stocks closed lower on Tuesday as hopes for a quick US-Iran peace deal faded following US strikes against Iranian targets, while concerns about possible rate hike moves by the European Central Bank weighed on sentiment.

The United States conducted “self-defense strikes” on Iranian missile launch sites and boats near the Strait of Hormuz, clouding the outlook for an interim deal between Washington and Tehran.

Meanwhile, the Israeli military launched a wave of strikes against Hezbollah in Lebanon’s Bekaa Valley and other parts of the country following an announcement by Prime Minister Benjamin Netanyahu that his country will intensify its attacks on the militia.

The European Central Bank (ECB) should raise interest rates in June even if there’s a quick resolution to the Middle East conflict, executive board member Isabel Schnabel said on Tuesday.

“Even if the war ended today, a lot of damage has already been done to energy infrastructure and global supply chains,” she said in an interview published on the ECB’s website.

European stocks closed lower

The Pan European Stoxx 600 ended down by 0.57%. Germany’s DAX and France’s CAC 40 fell 0.8% and 1.03%, respectively. The UK market, which returned to trading after an extended weekend, settled higher, with FTSE 100 gaining 0.24%. Switzerland’s SMI ended 0.17% up.

Among other markets in Europe, Austria, Belgium, Ireland, the Netherlands, Poland, Portugal, Russia, Spain, Sweden and Turkey closed weak.

The Czech Republic, Finland, Greece, Iceland and Norway ended higher, while Denmark closed flat.

In the UK market, miners and banks moved higher. Stocks from the realty sector found good support too.

Metlen Energy & Metals surged 6.5%. JD Sports Fashion climbed 4.7%, while IAG, Antofagasta, Endeavour Mining, Polar Capital Technology Trust, Glencore, Burberry Group, Lion Finance, Natwest Group, Convatec Group and Anglo American Plc gained 2-4%.

Melrose Industries fell 5.38%. BP, AutoTrader Group, RightMove, Compass Group, Tesco, LSEG, Diageo, Weir Group, BT Group, Bunzl and British American Tobacco also ended notably lower.

European stocks closed lower

In the German market, MTU Aero Engines fell nearly 4%. Deutsche Bank, SAP, Scout24, Fresenius, Commerzbank, Gea Group, Bayer, Siemens, Siemens Healthineers, Deutsche Telekom, Beiersdorf, Merck and Deutsche Boerse lost 1-2.3%.

Zalando moved up 3%. Infineon, E.ON, Continental and Mercedes-Benz also closed higher.

In the French market, Teleperformance tanked 11%. Carrefour and Credit Agricole both shed more than 6%. Bureau Veritas, Michelin, Hermes International, Kering, Safran, Eurofins Scientific, Publicis Groupe, Pernod Ricard, LVMH and EssilorLuxottica also ended sharply lower.

STMicroelectronics moved up nearly 5%. Stellantis, TotalEnergies, Engie and Edenred posted moderate gains.

In economic news, data released by British Retail Consortium showed UK shop price inflation increased 1.2% year-on-year in May, up from 1% in April, which had marked the softest growth in four months, and surpassed market expectations of 1.1%.

Notes From APS Radio News

FRED is a service that tracks a number of the world’s major central banks, including the US Federal Reserve, the Bank of Japan and the European Central Bank. In particular this linke shows the holdings of those banks as a function of time. In general, the holdings of a central bank, like the Federal Reserve are those assets that include Treasury bonds, mortgage backed securities and corporation bonds.

Between February of 2020 and the autumn of 2022 the Federal Reserve added over $4.6 trillon to its holdings.