European stock markets turned red on Thursday after financial data published by many companies for the third quarter showed results below expectations, adding to concerns about the situation in the Middle East and uncertainty about the evolution of the base interest rate in the United States, Reuters reported.

The pan-European STOX 600 index fell 1 percent early Thursday, hitting a two-week low amid a broad sell-off in shares of European automakers and real estate majors.

Geopolitical tensions continue to rise as anti-Israel and US protests erupted around the world on Wednesday and Thursday, while US Federal Reserve Chairman Jerome Powell is expected to make further comments today.

Since the end of last year, investors have been waiting for an easing of policy on the base interest rate in the United States, but for now the Fed continues to keep it at a high level to fight inflation, and the situation may remain in the context in which it seems that the American economy managed to avoid a recession, despite analysts’ expectations.

Share prices in European companies fell sharply this week as the continent’s bourses were hit by tensions in the Middle East and concerns about the Fed’s decision across the Atlantic.

“The combination of concerns about US inflation and sustainability is clearly the main factor that has led to further revaluation of markets,” said Thomas Hempell, director of macroeconomic research at Generali Investment. It also said investors were concerned that the Fed might even decide to raise the key interest rate again, as it did in May, instead of cutting it.

“This uncertainty about the Fed’s behavior clearly coincides with tensions in the Middle East,” he noted.

General decline in European stock markets

Nestle’s share price fell 4% on Thursday morning after the Swiss food giant released financial data showing that its sales over the past nine months were lower than expected, likely due to consumers’ reluctance to spend amid soaring prices. on many consumer goods.

Roche Holding’s share price fell 4.5% after the pharmaceutical company’s third-quarter sales were hit by lower demand for anti-Covid products.

France’s CAC 40 stock index fell to a seven-month low after Renault shares fell 7.4% after data showed the carmaker’s profit was also lower than expected.

Nokia, in turn, saw its share price fall 5% after posting better-than-expected financials and announcing nearly 15,000 layoffs.

The telecoms company, once Europe’s most valuable by market capitalization, was the worst performer on the Finnish stock market’s Helsinki 25 index on Thursday, falling 1.1 percent to a three-year low.

Shares in Frankfurt-listed Tesla also fell 4.8 percent after the Elon Musk-led automaker missed its third-quarter gross profit target.

The SX8P technology index was the only positive sector, rising 1.3%, as Germany’s SAP reaffirmed its status as the world leader in business software solutions, even if it too missed third-quarter revenue estimates.

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