European stocks sank to their lowest in a week as a surge in government bond yields knocked high-growth technology shares, with fresh signs of a slowdown in China’s economy weighing on investor sentiment, says an article published in DevDiscourse.
STOXX 600 index
The pan-European STOXX 600 index was down 1.3%, falling for a third session as a jump in U.S. Treasury yields signaled that investors were bracing for higher rates and the risk of persistent inflation.
While the benchmark STOXX 600 is on course to extend its quarterly winning run, a volatile September took some shine off its third-quarter gains as investors priced in risks of easing global growth momentum and tighter monetary policies.
Central bank against unchecked inflation
European Central Bank chief Christine Lagarde said on Monday inflation in the eurozone could exceed its already raised projections, while Federal Reserve Chair Jerome Powell said the central bank would move against unchecked inflation if needed.
Brent crude futures
However, a rally in Brent crude futures above $80 per barrel continued to support energy stocks, with the oil and gas index rising 0.9% to fresh highs since February 2020.
Swiss computer peripherals maker Logitech dropped 8.0% as Morgan Stanley downgraded the stock to “underweight”.
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Source: DevDiscourse
