Investing.com - European stock plunged Wednesday, as soaring Italian and Spanish borrowing costs added to concerns over the euro zone’s debt crisis, weighing heavily on equitty investor confidence.
At the close of European trade, the EURO STOXX 50 dropped 2.04%, France’s CAC 40 declined 2.24%, while Germany’s DAX 30 plunged 1.81%.
In bullish news, sentiment briefly improved amid reports the European Union may consider direct bank recapitalizations.
However the improvement was short lived as investors remained cautious after Italy’s Treasury sold EUR3.39 billion worth of five-year government bonds at an average yield of 5.66%, the highest since December and up from 4.86% at a similar auction last month.
Italy also sold EUR2.34 billion of 10-year debt at an average yield of 6.03%, the highest since January and up from 5.66% at a similar auction in April.
Meanwhile, the yield on Spanish 10-year bonds climbed to 6.54% earlier Wednesday, approaching the critical 7% threshold that preceded bailouts in Greece, Ireland and Portugal.
Bankia’s shares remained sharply lower, for the sixth consecutive session, diving 14.46%, as financial stocks continued to lead losses on European markets.
France’s BNP Paribas plummeted 3.67%, while Germany’s two biggest lenders, Deutsche Bank and Commerzbank, retreated 0.75% and 1.92% respectively.
Meanwhile, French steel company Vallourec plunged 3.43%, extending earlier losses, as the company continues to struggle with declining orders from Europe and Asia.
Shares in Voestalpine, Austria’s biggest steelmaker, also lost 1.15% after the company said its fiscal full-year net income after payment of hybrid bondholders fell to EUR333.5 million. Voestalpine also said it sees “a challenging environment” in the steel segment.
In London, commodity-heavy FTSE 100 plummeted 2.24%, weighed by losses in mining stocks, while data showed that net lending to individuals in the U.K. rose more-than-expected in April.
Shares in Rio Tinto tumbled 2.76% and Anglo American plummeted 2.13%, while Bhp Billiton declined 2.08%.
Copper producers Xstrata and Kazakhmys also added to losses, tracking a sharp decline in copper prices, as shares retreated 1.36% and 2.74%.
Elsewhere, U.K. lenders turned broadly lower. Shares in Barclays dropped 1.06% and Lloyds Banking tumbled 1.20%, while the Royal Bank of Scotland and HSBC Holdings plunged 1.50%, and 1.63% respectively.
In the U.S., equity markets followed sharply lower with the Dow down 1.31%, the S&P 500 off by 1.36% and the tech heavy Nasdaq down 1.30%
Investors are awaiting the U.S. GDP, ADP’s employment numbers and initial jobless claims, as well as, German unemployment figures and a speech by ECB president Mario Draghi.
At the close of European trade, the EURO STOXX 50 dropped 2.04%, France’s CAC 40 declined 2.24%, while Germany’s DAX 30 plunged 1.81%.
In bullish news, sentiment briefly improved amid reports the European Union may consider direct bank recapitalizations.
However the improvement was short lived as investors remained cautious after Italy’s Treasury sold EUR3.39 billion worth of five-year government bonds at an average yield of 5.66%, the highest since December and up from 4.86% at a similar auction last month.
Italy also sold EUR2.34 billion of 10-year debt at an average yield of 6.03%, the highest since January and up from 5.66% at a similar auction in April.
Meanwhile, the yield on Spanish 10-year bonds climbed to 6.54% earlier Wednesday, approaching the critical 7% threshold that preceded bailouts in Greece, Ireland and Portugal.
Bankia’s shares remained sharply lower, for the sixth consecutive session, diving 14.46%, as financial stocks continued to lead losses on European markets.
France’s BNP Paribas plummeted 3.67%, while Germany’s two biggest lenders, Deutsche Bank and Commerzbank, retreated 0.75% and 1.92% respectively.
Meanwhile, French steel company Vallourec plunged 3.43%, extending earlier losses, as the company continues to struggle with declining orders from Europe and Asia.
Shares in Voestalpine, Austria’s biggest steelmaker, also lost 1.15% after the company said its fiscal full-year net income after payment of hybrid bondholders fell to EUR333.5 million. Voestalpine also said it sees “a challenging environment” in the steel segment.
In London, commodity-heavy FTSE 100 plummeted 2.24%, weighed by losses in mining stocks, while data showed that net lending to individuals in the U.K. rose more-than-expected in April.
Shares in Rio Tinto tumbled 2.76% and Anglo American plummeted 2.13%, while Bhp Billiton declined 2.08%.
Copper producers Xstrata and Kazakhmys also added to losses, tracking a sharp decline in copper prices, as shares retreated 1.36% and 2.74%.
Elsewhere, U.K. lenders turned broadly lower. Shares in Barclays dropped 1.06% and Lloyds Banking tumbled 1.20%, while the Royal Bank of Scotland and HSBC Holdings plunged 1.50%, and 1.63% respectively.
In the U.S., equity markets followed sharply lower with the Dow down 1.31%, the S&P 500 off by 1.36% and the tech heavy Nasdaq down 1.30%
Investors are awaiting the U.S. GDP, ADP’s employment numbers and initial jobless claims, as well as, German unemployment figures and a speech by ECB president Mario Draghi.