Europe close: Stocks fall amid interest rate jitters
By Alexander Bueso
Date: Friday 06 May 2022
(Sharecast News) - European stocks slumped on Friday as fears of spiralling inflation and bigger interest rate rises dampened sentiment despite the release of a better-than-expected April jobs reports in the States.
"Stocks had been hoping for a quiet end to the week, with some breathing space after all the volatility, but it is not to be," said IG chief market analyst Chris Beauchamp.
"Investors continue to fret about the possibility of a recession in the US and elsewhere caused by monetary tightening. Earnings season has done little to assuage concerns about pressured consumer spending, leaving markets on the back foot once again."
The pan-European Stoxx 600 index was down 1.91% at 429.91. Oil and gas stocks bucked the trend as crude prices traded above $110 a barrel.
Germany's Dax meanwhile fell 1.64% to 13,674.29 and the Cac-40 by 1.73% to 6,258.36.
Bunds retreated further alongside, pushing their yields up by nine basis points to 1.135%.
The Dow Jones Industrial Average plummeted more than 1,000 points and the tech-heavy Nasdaq fell almost 5% overnight, wiping out gains from Wednesday as investors fretted that the Federal Reserve's interest rate rise this week would not be enough to combat raging inflation.
In equity news, shares in German sports gear maker Adidas fell 4% after it lowered expectations for 2022 sales as renewed Covid-related lockdowns in Greater China continue to hit trading.
Dutch bank ING fell 5% as it reported a worse-than-expected quarterly net income, including a surge in provisions for bad loans due to its exposure in Russia and Ukraine.
Danish medical device maker Ambu plummeted 12% after cutting annual earnings guidance due to supply-chain issues and hospital labour shortages.
Norwegian renewable energy company Scatec plunged 18% as the company said first-quarter results were hit by Russia's war in Ukraine, the broader geopolitical uncertainty and seasonality in the Philippines.
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