European markets fell after a decline. London’s FTSE ended lower under pressure from falling bank and resource stocks, while major European indices also broadly declined. With UK and euro area economic data and corporate earnings reports due next week, the outlook grew more uncertain.
In London, the FTSE 100 fell for the first time in four sessions, while the FTSE 250 was down 0.63% and the FTSE 350 Bank Index was down 2.33%. Barclays fell 3.5%, reportedly affected by reports of a regulatory audit concerning liquidity. Resource stocks also came under notable pressure following a decline in copper prices, with Anglo American down 4.1% and Glencore down 3.3%. Aerospace and defense stocks and utility stocks also declined.
In European equity markets, the CAC 40 fell 1.11% and the IBEX fell 1.49%, reflecting a broad market pullback. French financial institutions BNP Paribas, Crédit Agricole and Société Générale fell 2.5% to 3.4%. Carrefour fell 2.2%, while Unibail-Rodamco-Westfield fell 2.1%. The STOXX Europe 600 Banks Index fell 2.07%, and the STOXX Europe 600 Aerospace & Defense Index fell 1.43%. The technology stock index, meanwhile, rose 0.70%.
Earnings reports from SAP, Nokia and Barclays, among others, are scheduled for this week, while French government bond yields were observed rising in European interest-rate markets. The expansion of protests in France increased fiscal uncertainty, and long-term government bond yields in Germany and Italy also rose. European markets as a whole are increasingly being affected by political and fiscal risks.
In foreign exchange and bond markets, the euro traded at around $1.12, and volatility was observed in euro-area long-term bond yields. The German 10-year government bond yield was around 3.4%, while Italy’s 10-year yield rose to around 4.58%. The spread between 10-year government bond yields is narrowing, but uncertainty remains high.