German shares faced a decline as the latest US inflation data revealed an uptick in consumer price growth within the world’s largest economy, leading the DAX index to close down by 0.16%. In October, the US annual inflation rate increased to 2.6%, rising from 2.4% in September, while the core inflation rate held steady at 3.3%.
These figures aligned with the anticipated consensus for the month. Speculation has arisen regarding the possibility of the Fed pausing interest rate cuts, with futures reflecting only a 59% probability of another cut next month. Neel Kashkari from the Minneapolis Fed, known for his hawkish perspective, indicated that a significant shift in the inflation outlook would be necessary to alter the Fed's strategy dramatically.
In Europe, the market is awaiting the second estimate of the eurozone’s GDP growth for Q2, with expectations set at a 0.4% increase quarterly and a 0.9% rise annually. On the corporate front, Siemens Energy ($ENR) emerged as the standout stock in trading, surging 18.95% at closing, fueled by a return to profitability and revenue growth for the fiscal year ending September 30, as challenges related to its wind turbine division have begun to resolve.
Looking ahead to fiscal 2025, Siemens Energy anticipates a comparable revenue growth of 8% to 10%. Analysts at Berenberg commented, 'Given the performance of FY24 and the improving operational performance, the guidance seems to assume a material non-repeat from an order intake standpoint across the portfolio, which we view as conservative and beatable at this juncture.'.