The Stoxx 600 EUROPE index fell more than 1 percent on Thursday, recording the biggest monthly decline in a year, dragged down by gloomy corporate profits and as investors wait for more clarity on macroeconomic conditions and the outcome of the US elections.

The main pan-European stock index closed down 1.2 percent, falling to its lowest level since mid-August, with the retail sector leading an overall market decline with a drop of 4 percent.

The Stoxx 600 recorded a monthly decline of 3.4 percent, with the technology and real estate sectors hit hardest by the sell-off this month.

The main French index, the CAC 40, was the furthest behind monthly among its regional peers.

The US presidential election has kept investors on their toes. The possibility of higher tariffs and increased defense budgets could deal a major blow to an already struggling European economy if Donald Trump wins.

Some caution also emerged after a stronger-than-expected rise in eurozone inflation in October and the possibility of further acceleration in the coming months, strengthening the case for caution in easing policy. the monetary policy of the European Central Bank. This follows a 25 basis point interest rate cut this month.

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“This inflation data, coupled with better-than-expected GDP figures across the bloc, should be enough to remove the risks of the ECB cutting rates by 50 basis points in December,” according to Nick Rees, senior foreign exchange market analyst at Monex. Europe.

“Underlying price pressures continue to ease, which should be enough to drive a succession of 25 basis point cuts at upcoming meetings.”

Profits also failed to excite investors, with sectors such as large luxury companies, automakers and breweries, among others, hit by anemic Chinese demand.

Technology stocks were among the worst hit, with sentiment towards the sector further waning after quarterly reports from US tech giants Meta Platforms and Microsoft.

Anheuser-Busch InBev, the largest beer maker, fell 6 percent after reporting lower-than-expected third-quarter profits, revenue and volumes.

Lender BNP Paribas fell 4.2 percent as third-quarter results from its investment banking division, lower-than-expected capital buffers and weaker-than-expected sales in Belgium disappointed investors.

Rubis fell 10 percent after the French liquid products distributor cut its profit outlook for 2024, while telecommunications group Swisscom fell 5 percent after a drop in revenue on nine months.

Meanwhile, Societe Generale jumped 11 percent after the French bank beat profit estimates as CEO Slawomir Krupa reshuffled his management team.

Belgian biotechnology company Argenx rose 6 percent after better-than-expected third-quarter results.

Maersk rose 7.8 percent as higher-than-expected freight rates in the third quarter boosted its Ocean division and boosted its profit expectations for the full year.

French energy infrastructure company Technip Energies rose 11 percent after raising its annual revenue forecast. REUTERS