BRUSSELS (Alliance News) - European stocks edged lower on Tuesday, after Eurozone inflation slowed more than expected in May, raising concerns about deflationary pressures.
Traders were cautious ahead of the meeting of the European Central Bank on Thursday, leaving stocks little changed from their highest levels in more than six years.
Many analysts expect the European Central Bank to take some policy action to avoid deflation and spur lending to credit-starved smaller businesses. However, markets are still uncertain what additional measures the central bank will announce.
The Euro Stoxx 50 index of eurozone bluechip stocks was down 0.2%, and is down fractionally compared to a week ago.
The German DAX eased 0.3%, the French CAC 40 lost 0.26%, the UK's FTSE 100 was down 0.5%.
German conglomerate Bayer AG said that it has extended contract of Chief Executive Officer, Marijn Dekkers, by two years. Dekkers cited family reasons for extending his contract only until the end of 2016, the company said.
Bayer shares fell 1.2%.
Swiss drug giant Novartis AG said its investigational blood cancer drug Jakavi (ruxolitinib) achieved significant improvement in disease control in a late stage study. Shares slipped 0.2%.
Filtration and environmental technology company Porvair expects to report interim profits well ahead of last year. The stock was up 6.9%.
Wolseley, which reported higher third-quarter trading profit, rose 1.7%.
Swiss bakery business Aryzta reported significantly improved revenues for the third quarter, supported by both its Food and Origin businesses. The stock was up fractionally.
Euro zone inflation fell to 0.5% in May from 0.7% in April, flash estimates published by Eurostat showed. The rate was forecast to ease marginally to 0.6%. Inflation held below the European Central Bank's target of 'below, but close to 2%' for the sixteenth consecutive month.
Meanwhile, Euro area unemployment rate unexpectedly dropped in April, but remained at a high level. The seasonally adjusted jobless rate fell to 11.7% from 11.8% in March. Economists had expected the rate to hold steady at 11.8% for the fourth straight month.
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