European stocks retreat as markets track omicron, economic data

  • The U.S. Labor Department is set to release November's consumer price index reading on Friday afternoon in Europe.
  • Markets have been reacting throughout the past couple of weeks to comments and research into the transmissibility and severity of the new omicron Covid-19 variant.
  • A host of economic data is due from the U.K., Germany, Italy and Spain before the bell.

LONDON — European markets pulled back on Friday as renewed concerns about the omicron Covid-19 variant continue to weigh, while investors await key U.S. inflation data later in the day.

The pan-European Stoxx 600 fell 0.4% in early trade with tech stocks shedding 1% to lead losses, while autos bucked the downward trend to add 0.8%.

The U.S. Labor Department is set to release November's consumer price index reading on Friday afternoon in Europe. Global markets will be closely watching the reading for indications as to how the Federal Reserve may react. Estimates suggest inflation could have hit its highest year-over-year level since 1982.

Data on Thursday showed U.S. jobless claims hitting their lowest rate since 1969 last week, as 184,000 people filed new unemployment insurance claims, with the labor market continuing to tighten.

Markets have been reacting throughout the past couple of weeks to comments and research into the transmissibility and severity of the new omicron Covid variant, with a number of major economies now implementing tighter containment measures.

U.S. stock futures were little changed in early premarket trade on Friday, after investors pulled back from the rebound earlier in the week and switched focus to upcoming inflation prints.

Stocks in Asia-Pacific broadly declined on Friday as investors opted for caution ahead of the data, while keeping an eye on news about the omicron variant.

On the data front in Europe, Italian, British and Spanish industrial production figures for October are due Friday morning. The U.K. also releases October's GDP growth, manufacturing production, construction output and trade balance readings.

German final inflation figures for November are also due, and European investors may have one eye on speeches from ECB President Christine Lagarde and other top policymakers throughout the morning.

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