European stock markets ended Wednesday's trading session in the red, reflecting a broader declining trend. The Stoxx Europe 600 index fell by 0.49%, while the Swiss Market Index slipped by 0.50%. France's CAC experienced a drop of 0.57%, the FTSE in London declined by 0.68%, and Germany's DAX managed a minor decrease of 0.03%.
These figures suggest a cautious sentiment among investors in response to mixed economic signals. In a notable report from Eurostat, the annual inflation rate for the euro area decreased to 2.2% in August from 2.6% in July, indicating a significant drop from 5.2% a year earlier. In the broader European Union, the inflation rate was reported at 2.4% for August, a decline from 2.8% in July and down from a count of 5.9% in the same month last year.
Countries like Lithuania, Latvia, Ireland, Slovenia, and Finland reported the lowest annual inflation rates, whereas Romania, Belgium, and Poland faced the highest. Notably, annual inflation rates fell in 20 member countries compared to July, with rises in six and unchanged rates in one. Meanwhile, in the UK, the consumer price index (CPI) witnessed a 2.2% rise over the past twelve months through August, a figure that remained unchanged from July, according to the Office for National Statistics.
On a month-to-month basis, the CPI increased by 0.3% in August, consistent with the same rate reported a year ago. Evaluating core CPI—the measure excluding volatile food, energy, alcohol, and tobacco—showed an increase to 3.6% over the twelve months to August, up from 3.3% in July. Additionally, the ONS disclosed that producer input prices fell by 1.2% year-on-year as of August, a notable change from a revised rise of 0.2% reported for the year leading up to July.
In contrast, producer output prices showed a marginal increase of 0.2% year-on-year in August, a decline compared to the 0.8% increase a month earlier. Monthly comparisons revealed a 0.5% decrease in producer input prices and a 0.3% drop in output prices for August. On the corporate front, Meta Platforms is under scrutiny as it faces a possible antitrust fine from the European Union.
This is linked to allegations of attempting to dominate the online classified advertising market. Reliable reports from the Financial Times highlighted this legal challenge, although the European Commission declined to provide further comment. Meanwhile, Facebook has not yet responded to inquiries from MT Newswires. Furthermore, the EU general court issued a ruling on Wednesday that overturned a hefty fine nearing 1.5 billion euros (approximately $1.67 billion) levied against Alphabet's Google.
This decision pointed to errors made in the European Commission's evaluation. The fine had related to complaints regarding clauses within Google’s AdSense advertising service contracts, which allegedly threatened to inhibit competition. A spokesperson for Google expressed satisfaction with the court's recognition of the errors in the initial ruling, stating, "We are pleased that the court has recognized errors in the original decision and annulled the fine.
This case focuses on a very narrow subset of text-only search ads placed on a limited number of publishers’ websites." In other corporate news, pharmaceutical giant GSK announced that they have reached undisclosed settlements in two lawsuits filed in California, asserting that their former heartburn medication Zantac was a contributing factor to the development of cancer.
GSK denied any admission of fault concerning either settlement, resulting in both cases being dismissed. This development saw GSK shares decline by 0.34% during Wednesday's trading in London. Additionally, AstraZeneca, a renowned UK-based pharmaceutical company, reported that its drug Fasenra (benralizumab) gained approval from the US Food and Drug Administration for usage in adult patients diagnosed with eosinophilic granulomatosis with polyangiitis.
Following this announcement, AstraZeneca shares experienced a nearly 1% dip in London market trading..