European markets open lower as UK inflation misses

This is CNBC’s live blog covering European markets.

European stocks opened lower on Wednesday as regional markets continue to look at the outlook for inflation and the trajectory of interest rates.

The pan-European Stoxx 600 was last down 0.29% at 8:05 a.m. London time, with most major bourses starting the day in the red.

Most sectors fell as well, with autos down 1.93% and oil and gas stocks down 0.73%.

Inflation in the United Kingdom reached 2.3% on an annual basis in April, data released on Wednesday showed. That was above the forecast of 2.1%, but much closer to the Bank of England’s target of 2% than March’s reading of 3.2%.

Asia-Pacific markets traded mixed overnight, while US futures were little changed as investors awaited the release of Nvidia’s latest earnings report on Wednesday.

Traders will also watch for minutes from the latest Federal Open Market Committee meeting.

Markets see low chances of June BOE rate cut after UK inflation data

Traders cut bets that the Bank of England will start cutting interest rates this summer after UK inflation figures came in hotter than expected.

While the headline rate fell sharply to 2.3% from 3.2%, that was below a forecast in a Reuters poll of 2.1%. Both core and utility inflation, which are being closely watched by the Bank of Albania, were also higher than forecast.

At 8:40 a.m. in London, overnight interest rate swaps indicated a 13% probability of a rate cut at the June meeting, down from about 50% before the press. The probability of a cut in August had fallen from 70% to 40%, with a bank rate cut not fully assessed until November.

The British pound jumped on the news, trading 0.3% higher against the US dollar at $1.274 and 0.27% higher against the euro at 1.174. Both were sterling’s highest levels against currencies since March, according to LSEG data.

Jenny Reid

European markets open lower

European markets opened lower on Wednesday, with all major bourses starting the day in the red following the release of new UK inflation data.

The pan-European Stoxx 600 was last down 0.34% at 8:10 a.m. London time.

The UK’s FTSE 100 was meanwhile 0.52% lower, with Germany’s DAX down 0.4% and France’s CAC 40 down 0.43%.

Cars fell 2.3%, and oil and gas stocks lost 0.74%.

Sophie Kiderlin

UK inflation falls to 2.3% in April, edging closer to Bank of England target

UK inflation fell to 2.3% in April, the Office for National Statistics said on Wednesday, coming close to the Bank of England’s target rate but missing expectations.

The headline reading fell from 3.2% in March, but economists polled by Reuters had expected a bigger drop to 2.1%.

Core inflation, excluding energy, food, alcohol and tobacco, fell to 3.9% in April from 4.2% in March.

Read the full story here.

Jenny Reid

CNBC Pro: These 6 other chip stocks tend to move on Nvidia’s earnings

Six AI-related stocks worldwide have consistently reacted positively to Nvidia’s quarterly results, according to CNBC Pro research.

The analysis comes ahead of Nvidia’s first-quarter earnings this year, which will be released on Wednesday after the stock markets close.

Five of the six stocks have each risen between 6% and 33% in the past after Nvidia disclosed early earnings.

CNBC Pro subscribers can read more about the six stocks here.

Ganesh Rao

CNBC Pro: Morgan Stanley’s Slimmon names tech stocks to buy at a ‘reasonable price’

Andrew Slimmon of Morgan Stanley Investment Management has been consistently bullish on stocks even during periods of volatility.

While he fears a change in market conditions could cause “some sort of equity correction”, the senior portfolio manager believes it’s “clear sailing” for the stock for now.

“I think it will make sense to get a bit more defensive in the summer, but it’s too early for that,” he said. “Stick with a balance of growth and value names.”

He names four stocks to buy.

CNBC Pro subscribers can read more here.

Weizhen Tan

European markets: Here are the opening calls

European markets are expected to open lower on Tuesday.

Britain’s FTSE 100 is expected to open 43 points lower at 8,381, Germany’s DAX down 60 points at 18,708, France’s CAC 33 points lower at 8,139 and Italy’s FTSE MIB down 140 points at 34,788, according to data from IG.

Earnings come from Kingfisher, Smiths Group, Fresnillo and Generali. Eurozone trade and construction balance data for March are available.

Holly Elliott