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Adidas and online retailer Zalando tumbled 4.13% and 5.22%, respectively, after Adidas warned of potential price hikes because of US tariffs.
Meanwhile, Airbus gained 2.14% on upbeat earnings, with MTU Aero and Rheinmetall rising 3.13% and 1.47%, respectively.
German Inflation Boosts ECB Rate Cut Bets
Germany’s annual inflation rate eased from 2.2% in March to 2.1% in April, supporting bets on multiple ECB rate cuts. A more dovish ECB rate path could lower borrowing costs and weaken the EUR, potentially raising corporate earnings. A softer EUR could also improve the competitiveness of export-focused German-listed firms.
Weaker-than-expected US economic data also fueled speculation about a more dovish Fed stance, supporting risk appetite. The US economy contracted by 0.3% in Q1 2025 after expanding by 2.4% in Q4 2024.
Eurozone Inflation to Spotlight the ECB
On Friday, May 2, Eurozone inflation figures will influence the ECB rate path and risk assets. Economists forecast the annual inflation rate to ease from 2.2% in March to 2.1% in April. A softer reading could further fuel speculation about ECB rate cuts, potentially boosting demand for rate-sensitive stocks.
US Markets Jump on Earnings and Fed Bets
Meta Platforms (META) and Microsoft (MSFT) surged on Thursday, May 1, amid rising US recession risks. US equity markets advanced as investors reacted to corporate earnings reports and US economic data. The Nasdaq Composite Index jumped 1.52%, while the Dow and the S&P 500 rose 0.21% and 0.63%, respectively, marking eight straight sessions of gains.
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