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European stocks retreat on U.S. debt ceiling concerns; Commerzbank slumps

Investing.com - European stock markets traded in a cautious fashion Wednesday given the U.S. debt ceiling uncertainty and ahead of the release of the final eurozone inflation figures for April.

At 03:50 ET (07:50 GMT), the DAX index in Germany traded 0.1% higher, while the FTSE 100 in the U.K. dropped 0.2% and the CAC 40 in France fell 0.3%.

The looming U.S. debt ceiling deadline and the potential for a catastrophic U.S. debt default has created a degree of nervousness throughout global markets.

Talks between U.S. President Joe Biden and Republican Kevin McCarthy, the speaker of the House of Representatives, failed to come up with a deal on Tuesday, hitting sentiment in Europe.

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The session’s main economic data will be the final eurozone consumer inflation figures for April, which are expected to show that prices remained elevated.

In the corporate sector, Commerzbank (ETR:CBKG) stock fell over 7% despite the German lender reporting that its net profit nearly doubled in the first quarter. It added that its outlook depended on the fate of its mBank unit in Poland and assumed a mild recession.

UBS (SIX:UBSG) stock fell 0.2% after the Swiss bank flagged a financial hit of about $17 billion from the takeover of Credit Suisse.

Siemens (ETR:SIEGn) stock rose 2.2% after the German engineering and technology group raised its full-year sales and profit guidance after beating sales forecasts during its second quarter.

Oil prices retreated Wednesday after a surprise rise in U.S. crude stockpiles raised demand concerns at the world’s largest consumer.

U.S. crude inventories rose by around 3.6 million barrels in the week ended May 12, according to data from the industry body American Petroleum Institute, instead of the expected drawdown.

However, these losses have been limited as releases from the Strategic Petroleum Reserve have to be factored into the inventory build, while the drop in gasoline and distillates inventories pointed to improving demand ahead of the summer season.

Official U.S. government data on crude and product stockpiles from the Energy Information Administration are due later in the session.

By 03:50 ET, U.S. crude futures traded 0.8% lower at $70.31 a barrel, while the Brent contract dropped 0.7% to $74.39.

Additionally, gold futures fell 0.1% to $1,992.45/oz, while EUR/USD traded 0.3% lower at 1.0833.

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