Rising bond yields, Middle East conflict weigh on European stocks
Kitco News collects and features the top financial, economic and geopolitical news from around the world. Kitco's aggregated sources include some of the top newswires in the world including the Association Press, Canadian Press, Japanese Economic Newswire, and United Press International. European shares fell due to rising government bond yields and concerns over the Israel-Hamas war. The US warned of a significant risk to U.S. interests in the Middle East as Israel bombarded Gaza with air strikes. The yield on the benchmark 10-year Treasury note rose above 5.0% before paring gains ahead of key gross domestic product and inflation data from the country later this week. Italy's FTSE MIB index was among the few top gainers across the regional markets, up 0.7%. Major tech companies such as Microsoft (MSFT.O) and Alphabet are expected to report strong Q3 results, while the European Central Bank's interest rate decision is expected later this month. Meanwhile, Volkswagen (VOWG_p.DE) slipped to its lowest since April 2020 after cutting its profit margin outlook for the current year.
Published : 2 years ago by KitcoNewsNOW in Finance
Oct 23 (Reuters) - European shares edged lower on Monday as rising government bond yields and concerns over the Israel-Hamas war kept investors on edge, while Italy's FTSE MIB index was among top gainers across the regional markets.
Washington warned of a significant risk to U.S. interests in the Middle East as Israel bombarded Gaza with air strikes. Adding to the pressure, the yield on the benchmark 10-year U.S. Treasury note rose above 5.0% on Monday before paring gains, ahead of key gross domestic product and inflation data from the country later this week.
"The GDP (data) is likely to show quite a robust third quarter and add to expectations that the Fed will keep rates in restrictive territory for longer," said Laura Cooper, senior macro strategist for iShares EMEA at BlackRock. headtopics.com
Investors will brace for earnings from major U.S. technology firms such as Microsoft (MSFT.O) and Alphabet (GOOGL.O) and the European Central Bank's interest rate decision, due later this week. "European government bond yields are at multi-year highs in line with what we are seeing in the U.S. despite very different growth and inflation dynamics. So we expect the ECB to take on more of a dovish tone," said Cooper.
Miners (.SXPP) shed 1.1% as prices of most base metals took a hit from geopolitical tensions, while rate-sensitive real estate stocks (.SX86P) hit their lowest level since 2012, before paring declines. The sector ended 0.6% down. headtopics.com
Italy's FTSE MIB index (.FTMIB) was among few gainers across the region, up 0.7%, boosted by a 2.6% rise in UniCredit (CRDI.MI) as the lender planned to buy a 9% stake in Alpha Bank (ACBr.AT). Among other movers, Volkswagen (VOWG_p.DE) slipped 0.9%, falling as much as 3.2% to its lowest since April 2020 after the carmaker cut its profit margin outlook for the current year on Friday.Limiting losses in the healthcare sector (.SXDP), Indivior (INDV.L) jumped 5.2% after the drugmaker said it will pay $385 million to settle a lawsuit related to its opioid addiction treatment.
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