European Stocks Close Lower As Markets Track Virus News, Look Ahead To Policy Announcements

(RTTNews) - European stocks closed lower on Tuesday as investors reacted to news about a surge in coronavirus cases and data showing an acceleration and U.S. wholesale inflation, and looking ahead to the monetary policy announcements from the U.S. Federal Reserve, the European Central Bank, the Bank of England and several other central banks.

The Federal Reserve is widely expected to double the pace of tapering its asset purchase program to $30 billion per month in a move to fight high inflation.

Also, there are expectations the bank will start raising interest rates shortly after bringing its asset purchase program to a halt.

Data from the Labor Department showed the producer price index for final demand advanced by 0.8% in November after climbing by 0.6% in October. Economists had expected producer prices to rise by 0.5%. With the stronger than expected monthly price growth, the annual rate of producer price growth accelerated to 9.6% in November from 8.8% in October.

On the virus front, the UK government has reportedly pledged to open more vaccination sites in the days ahead as the new strain now accounts for 20% of confirmed Covid-19 cases in the country.

The pan European Stoxx 600 slid 0.84%. The U.K.'s FTSE 100 ended 0.18% down, Germany's DAX declined 1.08%, France's CAC 40 shed 0.69% and Switzerland's SMI lost 1.11%.

Among other markets in Europe, Belgium, Denmark, Finland, Iceland, Netherlands, Norway, Portugal and Sweden closed with sharp to moderate losses. Austria, Czech Republic, Greece and Poland ended marginally lower.

Spain and Turkey closed notably higher, while Russia ended flat.

In the UK market, Rentokil Initial tumbled more than 12% after it agreed to buy Terminix Global Holdings Inc. to expand in the United States.

BT Group shares shed 4.29%. Altice UK, telecoms group owned by the Patrick Drahi, said on Tuesday that it has acquired an additional 585.47 million shares (18%) in BT Group Plc, increasing its ownership to 1.785 billion shares.

Darktrace, Spirax-Sarco Engineering, Ashtead Group, Experian, Aveva Group, Intertek Group, Croda International, Bunzl, Scottish Mortgage and Polymetal International lost 2 to 4%.

Ocado Group surged up 5.5%. Evraz, British Land Co, Rio Tinto, BHP Group, Lloyds Banking Group, Natwest Group, IAG, Coca-Cola HBC, Vodafone Group, Associated British Foods, Kingfisher, Compass Group and Sainsbury (J) gained 1 to 2.5%.

In the French market, Schenider Electric and Dassault Systemes both gained about 2.5%. Teleperformance, STMicroElectronics, Legrand, Capgemini, Essilor, Publicis Groupe, Renault, Sanofi and LVMH shed 1 to 2.5%.

ArcelorMittal climbed more than 8%. The world's largest steelmaker said it had entered into repurchase agreements with certain holders of its convertible senior notes for a $395 million buyback program. Orange gained about 2.2% and Unibail Rodamco advanced 1.35%.

In Germany, Daimler, Infineon Technologies, HelloFresh, Zalando, Puma, Merck, Siemens and SAP lost 2 to 3.5%. Sartorius, BMW, Adidas and Bentang also declined sharply.

MTU Aero Engines moved up nearly 2%. Deutsche Bank and Deutsche Telekom also closed notably higher.

In the Swiss market, Vifor Pharma soared nearly 13% after Australian biopharmaceutical giant CSL said it would buy the Swiss drugmaker for $11.7 billion.