European stock markets tumbled into the red on Friday after UK retail sales fell unexpectedly in August.
Retail sales in Britain last month fell to a surprise 0.9% slump, as people spent less in shops and instead returned to restaurants and pubs, the Office for National Statistics (ONS) revealed.
This dashed expectations of a 0.5% rise in retail sales, and comes after retailers suffered a 2.8% fall in July.
Department store sales plunged 3.7%, while sports equipment sales and computer sales fell 1.2%.
“Today’s figures should remind retailers to start planning for Christmas, which could be one of the most exciting on record, especially given restrictions last year,” Erin Brookes of Alvarez & Marsal, said.
“It will be critical to understand consumer demands and solidify nimble and responsive supply chains, which are only as strong as their weakest link.
“Despite the turbulent times, businesses should be asking themselves how to bolster and diversify their supply chains so that they are not just focusing on immediate issues but are also future-proofing their business against long-term changes in consumer habits.”
Across the pond, the S&P 500 (^GSPC) slipped 0.8% at the time of the European close, and the tech-heavy Nasdaq (^IXIC) fell 1%. The Dow Jones (^DJI) edged 0.6% as traders remain uncertain over higher corporate taxes and the upcoming Fed meeting weighed on investors.
The cautious mood came after the number of Americans filing new claims for unemployment support increased by 20,000 on Thursday.
According to the US Labour Department, there were 332,000 new initial claims for jobless support in the week to 11 September, up from 312,000 in the previous seven days, on a seasonally adjusted basis.
Economists were expecting 320,000 claims, anticipating delayed filings after Hurricane Ida to create a small weekly increase.
In currency markets, the dollar sat near a three-week high.
Asian shares steadied overnight after losses earlier in the week, however, China jitters and global growth concerns continued to weigh on investors' minds.
In Japan, the Nikkei (^N225) rose 0.6% while the Shanghai Composite (000001.SS) was 0.2% higher. The Hang Seng (^HSI) climbed 0.5%, with traders looking for oversold stocks after the benchmark posted its lowest close in 10 months on Thursday.
"We're looking at a market that is nervous, though hasn't seen sentiment turn outright bearish," Kyle Rodda, analyst at IG markets, said.
"If you look for catalysts that could justify the next move to the upside in equities and risk assets, they are nowhere to be seen because global growth concerns are keeping investors on edge."
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