Europe close: Stocks hit by multiple concerns amid low trading volumes
By Alexander Bueso
Date: Thursday 19 Aug 2021
(Sharecast News) - European shares continued to slump on Thursday as fears of a sooner-than-expected tapering in global monetary policy, concerns around Delta Covid-19 and the ongoing crackdown on tech firms by Beijing dampened sentiment.
"European stocks have come under further pressure today, in a contrast to last week, the falls appear to be being driven by several factors, so you can pick your poison to a certain extent, however the prospect of a Fed taper is unlikely to one of the main factors, given that US yields are lower," said Michael Hewson, chief market analyst at CMC Markets UK.
"We can start with increasing concerns over a slowing global economy, in the face of increasing restrictions as Delta variant cases rise, as well as concerns about vaccine durability
The pan-European Stoxx 600 was down 1.51% at 467.24, alongside a 2.43% drop on France's CAC 40 to 6,605.89.
Milan's FTSE Mibtel gave back 1.63% to 25,928.78 alongside.
Minutes of the US Federal Reserve's latest policy meeting published the night before suggested it was set to rein in its massive stimulus programme as the spectre of rising inflation started to concern policymakers.
"While no date has yet been confirmed, there is an increasing split within its members and it appears increasingly likely that the taper will begin before the end of the year," said interactive investor head of markets Richard Hunter.
"Alongside some mixed retailer results, the unrest in Afghanistan and an apparently weakening Chinese economy, this has been a week to test the mettle of investors."
In equity news, miners were hit by the fall in commodity prices, with BHP, Anglo American and Antofagasta all down, with the latter also cutting annual production guidance.
Shares in Swiss building materials supplier Geberit fell as the company warned about rising raw materials prices after reporting a big leap in quarterly sales and earnings.
Shares in Danish hearing aid and audio company GN Store Nord plunged 12% after it missed second-quarter sales expectations.
Sales rebounded in April-June after being hit badly by the pandemic a year earlier, but GN - a major supplier of hearing aids to U.S. war veterans - said coronavirus lockdown measures had still prevented some veterans and other potential customers from physically visiting hearing specialists.
On the positive side, Swedish heat pump maker Nibe topped the Stoxx with a rise of 8.4% as it posted a rise in annual earnings.
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