European stocks started weakly today, Wednesday, as investors awaited the European Central Bank’s monetary policy decision. Stocks were impacted by declines in technology and luxury goods companies following disappointing results from ASML and LVMH.
The European Stoxx 600 index fell by up to 0.3% by seven minutes past the hour. ASML, the world’s largest chip equipment maker, saw its stock drop by four percent, leading to a 1.2% decrease in the technology sub-index to its lowest level in a month, according to Reuters reports.
It is worth noting that the company’s weak sales forecast for 2025 caused its largest daily decline in four years, triggering a selling wave in chip stocks worldwide.
In the luxury goods sector, things weren’t any better, as the French company LVMH’s stock fell by seven percent after announcing a decline in third-quarter sales, citing a drop in customer confidence in China to levels seen during the COVID-19 pandemic.
Similarly, shares of luxury companies Kering, owner of Gucci, Hermes, maker of Birkin bags, and Richemont, owner of Cartier, fell between 2.1% and 5.3%. These declines also led to a two percent drop in the personal and household goods index, which also includes companies like Burberry and Swatch.
Despite these negative trends, London’s Financial Times index rose by 0.6% after data showed that inflation in the UK had fallen more than expected in September, opening up the possibility of interest rate cuts next month.
Market participants expect the European Central Bank to cut interest rates by 25 basis points at the meeting scheduled for tomorrow, Thursday, which could support stocks.
On individual stocks, Stellantis’ stock fell by two percent after warning of a 20% drop in consolidated shipments during the third quarter. Adidas’ shoe manufacturing stock also dropped by three percent after announcing third-quarter results.
