Brussels/Frankfurt/Paris, May 20, (dpa/GNA) – European stocks closed sharply lower on Wednesday as rising concerns about inflation raised fears that global central banks might consider tightening their easy monetary policies sometime soon.
The yields on Euro area government bonds rose on concerns the European Central Bank could decide to scale back its emergency bond-buying program as early as next month.
A sharp plunge of the cryptocurrencies including the bitcoin, and worries about a surge in coronavirus cases in Asia further dented sentiment. Bitcoin, the world’s largest cryptocurrency, tanked by close to 40 per cent from its record high levels to US 31,000 dollars on Wednesday, hitting its lowest level since February. Investors also awaited the release of the Federal Reserve’s most recent policy meeting.
The pan European Stoxx 600 slid 1.51 per cent. The U.K.’s FTSE 100 shed 1.19 per cent, Germany’s DAX declined 1.77 per cent and France’s CAC 40 ended 1.43 per cent down, while Switzerland’s SMI closed lower by 0.87 per cent. Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Finland, Greece, Ireland, Netherlands, Norway, Poland, Portugal, Russia, Spain and Sweden closed with sharp to moderate losses.
Iceland and Turkey ended modestly higher. In the UK market, Anglo American, BHP Group, Antofagasta, Rio Tinto, Glencore, Royal Dutch Shell, BP, Intercontinental Hotels, Melrose Industries and CRH lost 2 to 5 per cent.
On the other hand, Ferguson rose sharply as the British plumbing and heating products supplier raised annual guidance after reporting strong revenue growth in its third quarter. Imperial Brands, Polymetal International, DCC and BT Group also posted strong gains.
Shares of infrastructure investment group John Laing climbed more than 11 per cent, after private equity firm KKR announced that it had agreed to buy the company for 2 billion pounds (2.84 billion dollars).
In the French market, ArcelorMittal, Renault, Faurecia, Total, Publicis Groupe, Bouygues, Safran, Sodexo, Credit Agricole, Air France-KLM, BNP Paribas and Airbus Group lost 2 to 5 per cent.
In Germany, Infineon Technologies shares tumbled on concerns about a global semiconductor shortage and disruption of supply chains due to Covid-19.
Siemens, HeidelbergCement, Daimler, Deutsche Telekom, BASF, Infineon Technologies, BMW, Volkswagen, Deutsche Bank and Bayer ended sharply lower.
Data from Eurostat showed euro zone inflation accelerated as expected in April because of a sharp rise in the costs of energy and services.
The data said consumer prices in the 19 countries sharing the euro rose 0.6 per cent sequentially and 1.6 per cent from a year earlier, up from the 1.3 per cent annual increase in March.
British consumer price inflation exceeded expectations in April on higher energy prices, separate data showed, with prices advancing 1.5 per cent year-on-year in the month, more than double the 0.7 per cent rise seen in March. A similar higher rate was last seen in March 2020.
European new car registrations rose 24.4 per cent year-on-year in the January to April period to 3.4 million units due to the low base of comparison amid coronavirus restrictions, data from the European Automobile Manufacturers Association/ACEA showed.
GNA