- Eurozone inflation falls
- Eurozone unemployment remains at record high
- Federal Reserve maintains QE
FTSE 100: -0.40%
CAC 40: 0.37%
FTSE MIB: 0.59%
IBEX 35: 0.79%
Stoxx 600: 0.26%
European equities were mixed as Eurozone inflation fell unexpectedly and unemployment held at a record high.
The consumer price index unexpectedly dropped to 0.7% in October from 1.1% in September, according to a flash estimate from the European Union's statistics office. It missed analysts' estimates for inflation to remain unchanged.
Meanwhile, the unemployment rate came in at 12.2% last month, in line with August, falling short of the forecast for the rate to fall to 12%.
Yet 60,000 more Europeans were unemployed on the month, bringing the total number of jobless to 19.45m, Eurostat said.
"The latest euro-zone inflation and unemployment figures will increase pressure on the ECB to take further action to support the economy," said Capital Economics.
Eurozone officials have repeatedly highlighted the necessity of creating policies that will increase employment, particularly for the region's youth.
On the upside, the region's economy finally ended its six-quarter-long recession in the second quarter, recording growth of 0.3%.
But in another downbeat note for Europe, market research institute GfK's consumer confidence index for Germany fell to 7.0 in November from 7.1 in October. Economists had predicted a reading of 7.2.
In the US, initial jobless claims for the week ending October 25th will later be unveiled along with the Chicago Purchasing Managers' regional manufacturing index which is pegged to fall to 55 in October from 55.7 in September. A reading above 50 signals expansion.
FOMC maintains policy
The US central bank yesterday decided to keep its monthly $85bn bond buying programme unchanged, pointing to weaker economic growth that was hampered by the 16-day partial government shutdown earlier this month.
While many economists expect a reduction to quantitative easing will be held off until March 2014, some interpreted the Fed's statement to suggest that it could come in December.
"Investors were spooked by what they believed to be a hint from the Fed in this month's statement, that asset purchases could be reduced at the December meeting," said Craig Erlam, Market Analyst at Alpari.
"If I'm honest, I just think that yet again the markets have overreacted [...] I still believe it will be March before tapering begins and I don't think the [Fed's] statement suggests otherwise."
The Fed also reiterated that it would keep interest rates near zero as long as the jobless rate remained above 6.5% and inflation did not threaten to rise above 2.5%.
Meanwhile, the Fed along with the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank (ECB), and the Swiss National Bank announced today that their existing temporary bilateral liquidity swap arrangements are being converted to "standing arrangements" that will remain in place until further notice.
The ECB explained that the existing temporary swap arrangements have "helped to ease strains in financial markets and mitigate their effects on economic conditions" and added that it expects the new arrangement to serve as "a prudent liquidity backstop".
Air France, Geberit
Air France's shares
slipped after Investec reiterated a 'sell' rating for the airline, citing a downgrade on the full-year 2014 earnings guidance.
Geberit gained after the maker of toilets and pipes reported better-than-projected third-quarter profit and confirmed full-year forecasts.
BNP Paribas advanced after the French bank reported a rise in third quarter net income that beat analysts' expectations.
AstraZeneca's shares fell after reporting third quarter results that fell short of consensus.
Royal Dutch Shell dropped after posting a fall in profit that missed forecasts.
Danske Bank fell after Denmark's biggest lender reduced its 2013 forecasts and lowered its target for how much it will return to investors.
L'Oreal slumped as the beauty products maker reported sales that fell short of market estimates due to weak performance in North America.
Other asset classes decline
The euro was down 0.70% to $1.3640.
Brent crude futures fell $0.246 to $109.590 per barrel on the ICE.