London: European stock markets witnessed a decline on Wednesday as uncertainty surrounding the ongoing Middle East peace negotiations overshadowed favorable US inflation data. The benchmark Stoxx Europe 600 index fell by 0.16% to close at 659.48 points.
According to Anadolu Agency, Germany's DAX 40 decreased by 0.23% to 26,331.07 points, while France's CAC 40 saw a drop of 0.46% to 8,674.94. Italy's FTSE MIB 30 edged down slightly by 0.01% to 53,698.66, and the UK's FTSE 100 lost 0.1%, closing at 10,833.15. Additionally, Spain's IBEX 35 index fell by 0.05%, ending the midweek session at 20,204.4. The euro traded at $1.1529 as of 1640GMT, marking a 0.12% decrease against the US dollar.
Investors are closely monitoring diplomatic efforts involving the US and Iran, as the lack of progress towards an agreement and uncertainty regarding the reopening of the Strait of Hormuz continue to pose geopolitical and energy-supply risks. Despite these concerns, US inflation figures released during the session offered some relief to the global risk appetite. The US Consumer Price Index showed a rise of 0.1% month-on-month and 3.4% year-on-year in July, aligning with expectations. Annual inflation eased from 3.5% in June, while core inflation slowed to 2.5% from 2.6%, as reported by the US Bureau of Labor Statistics.
On the corporate front, Danish wind turbine maker Vestas saw its shares surge nearly 20% following the announcement of a 26% annual increase in second-quarter revenue, reaching £4.72 billion ($5.45 billion). The company also revised its full-year adjusted operating margin forecast to 7% - 9% from a previous forecast of 6% - 8%, alongside announcing a £400 million share buyback program.
In Germany, annual consumer inflation accelerated to 2.8% in July from 2.3% in June, with prices increasing by 0.8% on a monthly basis, according to the Federal Statistical Office. Energy prices rose by 8.3% year-on-year, becoming the main driver of inflation, with motor fuel prices surging by 23% and heating oil prices increasing by 34.7%. Food prices rose by 0.4%, and services prices climbed by 2.9%, while core inflation, excluding food and energy, stood at 2.4%.