European Stocks Close Lower On Rate Hike Jitters

(RTTNews) - European stocks closed lower on Thursday, weighed down by strong U.S. jobs data and hawkish Federal Reserve minutes.

A report from payroll processor ADP showing private sector employment in the U.S. jumped by 235,000 jobs in December after surging by an upwardly revised 182,000 jobs in November. Economists had expected employment to jump by about 150,000 jobs compared to the addition of 127,000 jobs originally reported for the previous month.

The data has added to concerns about the outlook for interest rates. On Wednesday, the minutes from the Federal Reserve's latest monetary policy meeting indicated the central bank plans to continue raising interest rates and keep rates at a restrictive level for "some time."

The pan European Stoxx 600 ended down 0.2%. Germany's DAX drifted down 0.38% and France's CAC 40 dropped 0.22%, while the U.K.'s FTSE 100 climbed 0.64%. Switzerland's SMI fell 0.74%.

Among other markets in Europe, Belgium, Denmark, Netherlands, Russia and Turkiye ended weak.

Austria, Czech Republic, Greece, Ireland, Norway, Portugal, Spain and Sweden closed higher, while Iceland and Poland ended flat.

In the UK market, Next surged nearly 7% after the clothing retailer raised its pre-tax profit forecast for the current year, defying gloom about weakening consumption and the U.K.'s cost-of-living crisis.

Standard Chartered climbed 6.8%. Anglo American Plc, Associated British Foods, HSBC Holdings, Antofagasta, Frasers Group and JD Sports Fashion rallied 3 to 4.5%.

IAG, Kingfisher, BT Group, Barclays, Whitbread, Lloyds Banking Group, Natwest Group, Sainsbury (J) and IHG gained 1.7 to 3%.

Pearson tumbled nearly 6%. Croda International dropped 3.3% and Haleon ended nearly 3% down. Segro, Fresnillo, Rentokil Initial, Prudential, Aviva, Unite Group and Experian also ended notably lower.

In Paris, Eurofins Scientific, Sanofi, Carrefour, Vivendi, LVMH, Teleperformance and AXA lost 1 to 2.5%.

ArcelorMittal climbed nearly 3%. Saint Gobain gained about 2.3%, while Stellantis, Kering, Renault, STMicroElectronics and Bouygues gained 1 to 1.5%.

In the German market, Linde ended nearly 4% down. Merck lost about 2.5% and E.ON dropped 1.82%. Vonovia, Symrise, Deutsche Bank and Deutsche Wohnen also ended notably lower.

Zalando gained nearly 3%. BASF, Puma, Porsche Automobil, Volkswagen, Deutsche Telekom, Continental, BMW, MTU Aero Engines, Sartorius, Henkel and HelloFresh advanced 1 to 2%.

In economic news, the downturn in Germany's construction sector continued in December as spiraling prices, rising interest rates and weak investment dampened activity, survey results from S&P Global showed. The headline Construction Purchasing Managers' Index registered 41.7 in December, up from 41.5 in November.

Germany's exports unexpectedly declined in November, falling 0.3% on a monthly basis, on weak global demand, data from Destatis showed. The fall was in contrast to the 0.2% rise expected by economists.

Eurozone producer price inflation eased for the third consecutive month in November, with prices registering an annual increase of 27.1% after a revised 30.5% rise in October, data from the statistical office Eurostat showed. That was slightly slower than economists' forecast of 27.5%.

The UK service sector moved closer to stabilization from the contraction zone in December despite challenging business environment and the cost of living crisis, a closely watched survey showed.

The final S&P Global/Chartered Institute of Procurement and Supply services Purchasing Managers' Index improved to 49.9 from 48.8 in November. The flash reading was 50.0.