European Markets Dropped On Profit Taking & Weak Asian Data

(RTTNews) - The European markets snapped a 3-session winning streak Thursday. The pull back was attributed to profit taking, after the recent run up in equities. Disappointing economic data from China and Japan also had a negative impact on investor sentiment. Economic data from the United States also came in weaker than anticipated, adding to the slump in the afternoon.

The Bank of England kept its record low interest rate unchanged in a split vote and judged it premature to conclude that overseas events, especially those in China, had a huge adverse impact on the British economy.

At its meeting on September 9, the Monetary Policy Committee voted 8-1 to maintain interest rate at 0.50 percent as seen in the previous meeting held in August.

Ian McCafferty repeated his call for a quarter-point rate hike as he assessed that building domestic cost pressures would otherwise be likely to lead to inflation overshooting the 2 percent target in the medium term.

Policymakers also unanimously voted to retain quantitative easing programme at GBP 375 billion.

The Euro Stoxx 50 index of eurozone bluechip stocks decreased by 1.49 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, lost 1.55 percent.

The DAX of Germany dropped by 0.90 percent and the CAC 40 of France fell by 1.46 percent. The FTSE of the U.K. declined by 1.18 percent and the SMI of Switzerland finished lower by 1.05 percent.

In Frankfurt, E.ON dropped by 7.54 percent after the utility said its German nuclear business and related activities would remain at the future E.ON. Peer RWE also lost 4.18 percent.

Lufthansa gained 0.51 percent. The airline reported improved traffic and load factor for August.

Fraport climbed by 2.88 percent, after reporting the passenger data for August.

ThyssenKrupp decreased by 1.65 percent and Salzgitter lost 2.52 percent.

In Paris, Technip sank by 3.09 percent and Total surrendered 1.88 percent.

Carrefour declined by 3.25 percent. Kering fell by 2.71 percent and Pernod Ricard weakened by 2.01 percent.

In London, Wm Morrison Supermarkets declined by 2.84 percent. The company reported lower first-half profit and cut its dividend. The company said the turnaround would take time and require sustained investment in the proposition.

Dixons Carphone, which reported a strong start to the year, gained 2.34 percent.

Next increased by 1.30 percent, after the retailer announced a higher profit for its first half with improved sales performance. The company also backed its forecast for growth in fiscal 2015 profit and sales.

Mining stocks turned in a weak performance Thursday. Glencore sank by 7.84 percent and BHP Billiton dropped by 5.94 percent. Anglo American also fell by 3.49 percent.

French industrial production declined unexpectedly in July, data from the statistical office Insee revealed Thursday. Industrial production slid 0.8 percent in July from June, when it remained flat. It was expected to grow 0.2 percent.

France's non-farm payroll employment increased in the three months ended June after staying flat in the previous quarter, figures from the statistical office INSEE showed Thursday. Payroll employment in the principally market sectors, which include the manufacturing, construction and service sectors, rose 0.2 percent quarter-on-quarter in the second quarter, after showing no variations in the preceding quarter.

U.K. house prices logged its biggest monthly increase in 15 months, data from Lloyds Banking Group's Halifax division revealed Thursday. House prices advanced 2.7 percent in August from July, which was the fastest increase since May 2014. Economists had forecast prices to climb 0.5 percent after falling 0.4 percent in July.

House prices in the United Kingdom spiked in August, the latest survey from the Royal Institution of Chartered Surveyors showed on Thursday as its house price balance surged to 53 percent. That topped forecasts for an increase of 46 percent and was up sharply from 44 percent in July.

China's inflation accelerated in August on soaring food prices, while producer prices fell at the fastest pace since late 2009 largely due to easing commodity prices.

Inflation rose to a 12-month high of 2 percent in August from 1.6 percent in July, the National Bureau of Statistics reported Thursday. It was expected to rise to 1.8 percent.

Producer prices declined at a faster pace of 5.9 percent annually, following a 5.4 percent drop in July. This was the weakest rate since late 2009 and marked 42 consecutive months of declines.

Core machine orders in Japan skidded 3.6 percent on month in July, the Cabinet Office said on Thursday - worth 805.6 billion yen. The headline figure was well shy of forecasts for an increase of 3.3 percent following the 7.9 percent contraction in June.

After reporting a bigger than expected increase in first-time claims for U.S. unemployment benefits last week, the Labor Department released a report on Thursday showing that jobless claims pulled back in line with estimates in the week ended September 6th.

The report said initial jobless claims fell to 275,000, a decrease of 6,000 from the previous week's revised level of 281,000. Economists had expected jobless claims to dip to 275,000 from the 282,000 originally reported for the previous week.

With fuel prices showing another substantial decrease, the Labor Department released a report on Thursday showing that U.S. import prices fell more than expected in the month of August. The Labor Department said import prices tumbled by 1.8 percent in August following an unrevised 0.9 percent decrease in July. Economists had expected import prices to drop by 1.6 percent.

Additionally, the report also showed a steep drop in export prices, which slumped by 1.4 percent in August after falling by a revised 0.4 percent in July. Export prices had been expected to edge down by about 0.4 percent compared to the 0.2 percent drop originally reported for the previous month.

Wholesale inventories in the U.S. unexpectedly saw a modest decrease in the month of July, according to a report released by the Commerce Department on Thursday. The report said wholesale inventories edged down by 0.1 percent in July following a downwardly revised 0.7 percent increase in June.

The drop came as a surprise to economists, who had expected inventories to rise by 0.3 percent compared to the 0.9 percent increase originally reported for the previous month.