FX.co ★ European Stocks Pull Back

European stocks firmly closed lower on Thursday, mirroring the broader decline in global equities driven by escalating concerns over US debt and potential risks to European economic growth. The STOXX 50 index decreased by 0.6% to settle at 5,425, while the STOXX 600 experienced a sharper decline of 0.7%, closing at 540. Recent data revealed an unexpected contraction in private sector activity within the Eurozone for May, highlighting a more significant impact from uncertain economic conditions than previously anticipated. This occurred just as the European Central Bank's latest meeting minutes illustrated that the Governing Council perceives the disinflationary phase nearing completion, potentially allowing for more flexible monetary policies if required. The day's losses were primarily led by luxury goods manufacturers and automobile producers, who continued to exhibit volatile trends. Notably, Hermes and LVMH each saw their shares drop by nearly 2%, while Stellantis experienced a close to 4% decline. In contrast, Generali posted a slight gain after releasing its first-quarter results for January.