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Focus on inflation in the eurozone and central bank chatter

The majors

It was a relatively bullish day for the European majors on Tuesday.

The DAX30 gained 0.61%, with the CAC40 and EuroStoxx600 increasing 0.34% and 0.24%, respectively.

Key statistics from the Eurozone and the US pointed the way throughout the session.

Prior to the European open, upward moves in US futures provided support for the open.

The statistics

Economic growth in the euro area

In the third quarter, the economy of the euro zone grew by 2.2%, which corresponds to the preliminary figures compared to the previous quarter. Year-on-year, the eurozone economy grew by 3.7%, which was also in line with the preliminary figures.

According to Eurostat,

  • In the previous quarter, GDP in the euro area had grown by 2.1%.
  • The number of people in employment rose by 0.9% in the third quarter of 2021.
  • In the previous quarter, the number of people in employment had risen by 0.7%.

Inflation in the member states

In October, French consumer prices rose by 0.4% compared to the previous month, which was in line with preliminary figures. Consumer prices were down 0.2% in September.

France’s annual inflation rate accelerated from 2.2% to 2.6% in October, also in line with preliminary figures.

In Italy consumer prices rose by 0.7%, compared to a preliminary 0.6%. Consumer prices were down 0.2% in September.

From the USA

Retail sales were in focus amid market fears over inflation.

In October, retail sales rose 1.7% month-over-month, versus a forecast increase of 0.9%. Retail sales were up 0.5% in September.

Core retail sales rose 1.7% in October versus a forecast 1.0% increase. In September core retail sales were up 0.7%.

Other statistics included industrial production, import and export price data, and inventory levels. The numbers were subdued, however, with the focus being on retail sales that day.

The market movers

For the DAX: It was a mixed day for the auto industry on Tuesday. Continental with a rally of 3.52% at the top. Daimler and Volkswagen also found support, rising 0.46% and 0.33%, respectively. BMW against the trend, however, falling by 0.09%.

It was a mixed day for the banks too. Deutsche Bank increased by 0.36% while Commerzbank down by 0.80%.

From the CAC, it was a bearish day for the banks. BNP Paribas slipped 1.62%, with Soc Gen and Credit Agricole ended the day down 0.13% and 0.61%, respectively.

However, it was a bullish day for the French auto sector. Stellantis NV and Renault ended the day up 1.23% and 1.53% respectively.

Air France-KLM decreased by 1.30% while Airbus SE increased by 0.84%.

On the VIX index

The VIX on Tuesday was back in the red.

The VIX partially reversed a 1.23% rise Monday, falling 0.73% to end the day at 16.37.

The NASDAQ rose 0.76%, with the Dow and S & P500 gaining 0.15% and 0.39%, respectively.

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