European stocks today: Stoxx 600 down 2.8%

LONDON (AP) — European stocks fell to two-month lows on Monday as global investors fled risky assets en masse on fears about inflation.

The pan-European Stoxx 600 provisionally ended down 2.8%, hitting its lowest level since March 8. Travel and technology stocks led the losses, down 5.8% and 4.8% respectively, as all sectors and major stocks traded firmly in negative territory.

The risk aversion for European markets comes after regional stocks pulled back at the end of the last trading week due to a loss in US markets, with Wall Street posting its worst day since 2020 last Thursday.

US stocks fell sharply on Monday, pushing the S&P 500 to a new 52-week low, as traders struggled to find footing after a dramatic week of US trading. Stocks in Asia-Pacific also fell on Monday.

“Even the volatility of volatility is on the rise. The Vix index, which tracks the expected volatility of the S&P 500, fell a fifth in the first half of the week before jumping 25 percent on Thursday. It is now more than double the five annual average”.

stuart kirk

Global Head of Research and Responsible Investments, HSBC

Global markets have been volatile in recent weeks due to uncertainty over the outlook for monetary policy, inflation and economic growth.

“Even the volatility of volatility is on the rise. The Vix index, which tracks the expected volatility of the S&P 500, fell a fifth in the first half of the week before jumping 25 percent on Thursday. It is now more than double the five annual average,” said Stuart Kirk, global head of research and responsible investing at HSBC.

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Investors are also keeping an eye on the war in Ukraine as dozens of people are feared dead after a school in the Luhansk region of eastern Ukraine was attacked by Russian bombardment. Luhansk is one of the two regions that make up the Donbas, where Russian troops now largely concentrate their attacks.

Russia was also under scrutiny on Monday as it celebrated its “Victory Day”, a public holiday commemorating the defeat of Nazi Germany by the Soviet Union in World War II.

In his speech, President Vladimir Putin attempted to justify his unprecedented invasion of Ukraine by claiming without evidence that the West was “preparing for the invasion of our land, including Crimea,” according to a Reuters translation.

US First Lady Jill Biden paid a surprise visit to Ukraine on Sunday. The United States and the Group of Seven countries announced they would increase short-term financial support for Ukraine as the war with Russia nears the three-month mark.

Also weighing on investor sentiment is continued coronavirus lockdowns in China. In oil markets, international benchmark Brent crude futures sank 5.2% to $106.52 a barrel, while US light crude futures fell 5.6% to $103.61. China is the world’s largest oil importer.

In terms of individual stock price movement in Europe, German food delivery company Delivery Hero tumbled 13% to the bottom of the Stoxx 600.

UK ad agency S4 Capital plunged 11% after being forced to cut its earnings outlook after an audit problem forced it to delay the release of its full-year results.

— CNBC’s Jesse Pound contributed to this market report.

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