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European Stocks Close Lower Thursday After Data Shows UK GDP Shrinking in March

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Last updated: 05/12/2022 12:28:12

12:28 PM EDT, 05/12/2022 (MT Newswires) -- European stock markets closed lower Thursday after preliminary Q1 gross domestic product data for the UK came in weaker than expected and showed the economy shrinking in March.

The Stoxx Europe 600 fell 0.6%, France's CAC lost 1%, Germany's DAX was off by 0.6%, London's FTSE 100 was down 1.6%, and the Swiss Market Index dropped 0.4%.

The UK's GDP is estimated to have increased by 0.8% in Q1, although there was no growth in February and a fall of 0.1% in March, according to preliminary data from the country's Office for National Statistics. In terms of output, services increased by 0.4% with the largest contributors from the information and communication, accommodation and food, and transportation and storage industries, while wholesale and retail declined, the agency said.

Meanwhile, recruitment activity across the UK continued to rise at a "robust pace" in April as demand for staff increased at a historically sharp pace, according to the latest UK Report on Jobs compiled by S&P Global.

The European Commission will phase out the state aid COVID temporary framework adopted in March 2020 in a move it said will enable member states "to remedy a serious disturbance in the economy in the context of the coronavirus pandemic." The state aid framework will not be extended beyond the current expiry date, which is June 30 for most of the tools provided.

On the corporate front, BP (BP.L) fell 4.7% in London after saying it has submitted bids for two offshore wind leases in the Netherlands that combined have 1.4 gigawatts of potential generating capacity.

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