European Stocks Drop as UK Inflation, Eurozone Industrial Production Jump

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European stock markets closed lower on Wednesday as investors digested UK annual inflation data.

The Stoxx Europe 600 dropped 0.8% and the German DAX closed down 0.7%, while the French CAC 40 and the Swiss Market Index fell 1% each. The FTSE 100 Index in the UK was down 0.3%, outperforming on gains in the energy and mining sectors.

The UK’s consumer price index was up 3.2% year-over-year in August, up from a 2% annual gain in the prior month, driven by higher food and transportation costs, official data showed. That exceeded market expectations for a 2.9% annual increase. On a monthly basis, consumer prices jumped 0.7% in August, surpassing expectations for a 0.5% increase. Consumer prices had been flat in July.

The UK House Price Index showed home prices increased 8% in the year to July, while dropping 3.7% from the prior month. The annual gain stood at 13.1% in June.

The UK’s Financial Conduct Authority said it is exploring changes…

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