European shares fell on Wednesday, led by losses in real estate and technology sectors, with the pan-European STOXX 600 down nearly 0.2%. Real estate dropped 1.2%, and tech stocks fell 1.1%. Conversely, UK stocks rose as the FTSE 100 climbed 0.2%, driven by metal miners reacting to favourable inflation data.
UK inflation hit the 2% target in May, its first return to this level in nearly three years. Despite this, persistent price pressures suggest the Bank of England will delay interest rate cuts. Richard Flax of Moneyfarm highlighted the risk of being too dovish on inflation.
Upcoming interest rate decisions from central banks in Britain, Norway, and Switzerland are now the market’s focus. Last week’s sharp losses in European shares followed France’s snap election call, with its high debt levels causing concern.
The French CAC 40 fell nearly 0.8%, while travel and leisure stocks on the STOXX 600 gained 0.6%, boosted by Accor’s 1.4% rise after an upgrade from Barclays. SMA Solar Technology AG plummeted 31% following a profit guidance cut, and Umicore surged 3.4% on a J.P. Morgan upgrade. Trading volume was low due to a U.S. public holiday.
