Europe open: Shares down again as bond yields rise; Eyes on BoE

by | Aug 3, 2023

(Sharecast News) – European shares posted another sharp decline at the open on Thursday, as investors fretted about higher US bond yields and payroll data, while they also looked ahead to a Bank of England rate decision later n the day.
The pan-European STOXX 600 index fell 1.07% in early deals with all major bourses lower. US bonds yields hit nine-month peaks following strong private jobs data and refunding announcement of Washington’s maturing debt.

“Much of the weakness originated in the Treasuries markets, where prices have slipped, and yields risen quite notably in the last few days,” said Steve Clayton, head of equity funds at Hargreaves Lansdown.

“Treasuries were hit by payroll data suggesting the US economy is still adding substantial numbers of new jobs, raising concerns that the Federal Reserve may have to go further with rate increases, despite having already delivered the largest, fastest hiking cycle in decades. The yield on US 10-year Treasuries is now pushing toward 4.15% which is within a whisker off its 15-year high level.”

In equity news, Infineon fell 11% after the chipmaker forecast a decline in fourth-quarter revenue.

London Stock Exchange Group was lower after first-half results, while budget airline Wizz Air slumped after lowering first-half capacity forecasts, despite swinging to a first-quarter profit.

Moving against the trend were France’s third-largest bank Societe Generale and and Dutch peer ING, which both rose after reporting better-than-expected quarterly earnings.

Anheuser-Busch InBev climbed after higher-than-expected second-quarter earnings.

Reporting by Frank Prenesti for Sharecast.com

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