Eurozone Stocks Hit Four-Month Low as French Fiscal Worries Weigh on Bank Shares

Deep News
9 hours ago

Eurozone benchmark blue-chip equities briefly fell to a four-month low, with concerns over France's fiscal risks triggering a selloff in banking stocks.

The Euro Stoxx 50 index closed down 1.5%, having fallen as much as 1.9% during the session, led by declines in bank and technology shares. Both sectors rank among the best-performing segments in Europe this year.

The Euro Stoxx Banks Index dropped 3.4%, with UniCredit and BBVA among the biggest drags on the index.

Market volatility also picked up, with the Euro Stoxx 50 Volatility Index rising 7.8% to 19.1 points.

Rising European bond yields weighed on banking stocks, as investors sold French government debt amid the country's political and economic crisis.

On Wednesday, the spread between French and German 10-year government bond yields widened to around 140 basis points.

The multiple crises facing France could push the European Central Bank into a standoff with investors, a situation not seen since the eurozone debt crisis more than a decade ago.

Aneeka Gupta, research director at WisdomTree UK, said: "What we are seeing in France is a repricing of fiscal and political risk, not a solvency crisis. The market is demanding a political risk premium, rather than questioning France's ability to repay its debt."

Meanwhile, the pan-European Stoxx 600 index fell 1%.

Recent attacks by Iran on oil tankers in the Strait of Hormuz have become increasingly frequent, pushing Brent crude to around $101 a barrel.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Most Discussed

  1. 1
     
     
     
     
  2. 2
     
     
     
     
  3. 3
     
     
     
     
  4. 4
     
     
     
     
  5. 5
     
     
     
     
  6. 6
     
     
     
     
  7. 7
     
     
     
     
  8. 8
     
     
     
     
  9. 9
     
     
     
     
  10. 10