Europe open: Shares slump ahead of US CPI data

The slide in European shares continued on Friday after a sell-off on Wall Street and ahead of US inflation data later in the day.

The pan-European Stoxx 600 index was down by 1.24% in early deals, with all major regional bourses lower. Investors were also rattled by the European Central Bank signaling its intention for an interest rate rise next month.

“With the ECB now joining the clutch of central banks in tightening mode, the spectre of stagflation looms large once more as investors seek refuge from the gathering storm,” said Interactive Investor head of markets Richard Hunter.

“With the Federal Reserve likely to hike rates again next week, it remains to be seen whether the rises so far have had the desired impact on reining in the economy without tipping the country into recession.”

Economists are forecasting a US CPI rise of 0.7% for May compared with a 0.3% rise in April.

In equity news, shares in pharma giant GSK jumped after the company said its vaccine for respiratory syncytial virus was successful in a late-stage trial for people over 60.

Just Eat was higher on a report its US wing has attracted preliminary interest from private equity firms, including Apollo Global Management.