European Stocks Drop for Third Day on Geopolitical Worries
European stocks fell for a third straight session on concerns about rising geopolitical tensions in the Middle East and concerns about higher U.S. inflation.
The Stoxx Europe 600 Index fell 0.6% as of 8:14 a.m. in London, with financial services and consumer discretionary leading declines. Energy stocks outperformed.
The rebound in European stocks has faltered this month amid rising tensions in the Middle East. Senior U.S. officials are reportedly preparing for a possible attack on Iran in the coming days. However, the conflict has so far not triggered a rush to safety. Volatility has crept up but remained subdued as investors have not increased exposure to stocks after April’s selloff.
Nestle SA fell 0.1%. The company picked longtime Inditex SA executive Pablo Isla as its next chairman to replace company veteran Paul Bulcke when he retires next year. Vodafone Group Plc rose 0.1% after appointing Pilar López as chief financial officer to start in December. Meanwhile, sentiment turned cautious after the Federal Reserve on Wednesday hinted at a possible rise in inflation. "I can't get too excited about the stock market at this point," said Dan Boardman-Weston, chief investment officer at BRI Wealth Management.
"You have the risk of inflation still lingering and the volatility in rates is likely to return. All of this is going into the summer, when liquidity tends to dry up." In other individual stocks, recruiting firm Hays Plc fell as much as 20% after posting a trading update. For more on equity markets:
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Source: Bloomberg
