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European shares fall as Bank of England boost fades; Stoxx 600 down 1%

Semiconductor shortages should decrease in 2024, says CFO of Porsche

Semiconductor shortages will continue to affect Porsche throughout 2023, according to Arno Antlitz, Volkswagen’s chief financial officer, but supply should improve the following year.

“We expect a better supply in 2023, but we expect the easing of the shortage to start only in 2024,” Antlitz told CNBC’s Annette Weisbach.

The comments were made as Antlitz reflected on Porsche shares making their debut on the Frankfurt stock market.

—Hannah Ward-Glenton

The economic mood in the Eurozone continues to deteriorate

The European Commission’s economic sentiment indicator, which aggregates surveys of business and consumer confidence, fell to 93.7 in September from 97.3 in August, the lowest point since November 2020.

Confidence fell across economic sectors amid a broad rise in inflation expectations, despite the European Central Bank’s commitment to interest rate hikes to curb rising prices.

– Elliot Smith

Porsche shares rise in Frankfurt market debut

Porsche shares rose almost 2% over the IPO in its IPO on Thursday, in what is being billed as one of Europe’s biggest public offerings ever.

Shares in the luxury car maker initially traded at 84 euros ($81) at the start of the day.

The shares had been priced at the top of the range late Wednesday, valuing the company at 75 billion euros.

European shares fall as Bank of England boost fades;  Stoxx 600 down 1%

Read CNBC’s full coverage here.

—Hannah Ward-Glenton

Shares on the move: Rational up 12%, Barratt Developments down 9%

Rational shares jumped more than 12% in early trade to lead the Stoxx 600 after the German combi steamer and oven maker raised its sales revenue and profit forecast for 2022.

At the bottom of the European blue chip index, British property developer Barratt Developments fell more than 9%.

CNBC Pro: Analyst says this FAANG stock is an evergreen winner — and investors should buy the dip

Tech stocks have had a rough year so far, but a Rosenblatt Securities analyst believes the selloff is an opportunity for long-term investors to buy the decline.

“Stay away from the losers,” he said, recommending “winners in the various secular battles and evolutionary battles” in technology.

Pro subscribers can read more.

— Zavier Ong

Stocks could continue this “oversold rally” over the next few days, says Wells Fargo’s Harvey

Wells Fargo’s Chris Harvey expects stocks to continue moving higher.

“The spike in short interest, skew in retail sales and the BOE’s action suggest stocks will continue their oversold bounce over the next few days,” he said in a note to clients on Wednesday.

Stocks hit new lows earlier in the week, with the S&P 500 experiencing another bear market. The sell-off was triggered by the Fed’s latest interest rate decision last week, which some investors believe steered the market into oversold conditions.

As the cost of capital rises and prices near record highs, the consensus is increasingly coming to believe that a Fed-induced recession is inevitable, Harvey said.

“We look at a recession like a car accident,” he wrote. “You never know how bad it will be, but there is almost no ‘better than expected’ outcome – so policymakers need to be careful what they wish for.”

– Samantha Subin

10-year government interest rate falls the most since 2020

The yield on the benchmark 10-year government bond index fell by the most since 2020 on Wednesday, despite a brief peak of 4% earlier in the session, after the Bank of England announced a bond-buying plan to stabilize the British pound.

The 10-year Treasury yield last fell 23 basis points to 3.733%, the most it has fallen since 2020.

It peaked around 4.019%, a key level that was the highest since October 2008, earlier in the day before erasing those gains.

Yields and prices move in opposite directions. One basis point is equal to 0.01%.

European markets: Here are the opening calls

European stocks are expected to open in negative territory on Wednesday as investors react to the latest US inflation data.

Britain’s FTSE index is expected to open 47 points lower at 7,341, Germany’s DAX 86 points lower at 13,106, France’s CAC 40 down 28 points and Italy’s FTSE MIB 132 points lower at 22,010, according to data from IG.

Global markets have pulled back after a higher-than-expected U.S. consumer price index report for August showed prices rose 0.1% for the month and 8.3% annually in August, the Bureau of Labor Statistics reported Tuesday, defying economist expectations for the headline inflation will fall 0.1% month-on-month.

The core CPI, which excludes volatile food and energy costs, rose 0.6% from July and 6.3% from August 2021.

UK inflation figures for August are out, and Eurozone industrial production for July will be published.

—Holly Ellyatt

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