(Bloomberg) — European equities fell the most in two weeks as worries over omicron’s spread reining in global growth along with the pullback in monetary stimulus weighed on the sentiment.
The Stoxx 600 Index retreated 1% by 12:58 p.m. London time. Technology stocks were among the biggest decliners as investors sold out of pricier areas of the market, while automakers slumped after European car sales plunged to a record low in November. Energy shares were under pressure with oil dropping.
European equities have been retreating further from record highs amid concerns about new restrictions over the omicron variant and as the Federal Reserve announced its hawkish shift.
Virus risks are in focus as Wales will bring back social distancing rules in offices and close nightclubs after Christmas, adding pressure on U.K. Prime Minister Boris Johnson to introduce tougher measures in England.
Aneeka Gupta, research director at WisdomTree, said that while the backdrop is much better from a growth perspective, there is still the risk posed by omicron and other virus variants in the background.
“We definitely see there’s going to be volatility going into 2022, and that could emanate from inflation, it could even crop up from geopolitical risk,” Gupta said by phone. “It’s definitely going to be a tricky path to navigate in 2022.”
Deal-making news spurred some individual moves across European equities, with shares in Rubis rising after the French oil-terminal operator agreed to buy as much as 80% of solar developer Photosol. Cellnex Telecom SA dropped after its towers deal risked a veto by the U.K.’s antitrust regulator.
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