London Stock Exchange
Toby Melville | Reuters
The pan-European Stoxx 600 fell 0.8% early in the afternoon, with cars falling 3% to take losses as most sectors and major exchanges traded in negative territory. Oil and gas stocks bucked the trend to add 0.8%.
Risk sentiment was dampened by aggressive signals from ECB policymakers, with Bundesbank president Joachim Nagel telling a German newspaper that the ECB should continue to raise interest rates even as recession risk in Germany increases.
The minutes of the ECB’s most recent policy meeting will be released on Thursday, as investors keep a close eye on the euro-zone flash PMIs expected on Tuesday.
Shares in Asia-Pacific were mixed Monday as caution prevailed, though Chinese markets rose after China’s central bank cut its benchmark interest rates.
U.S. stock futures fell in early pre-market trading after the S&P 500 experienced a four-week winning streak on Friday, as Wall Street previews comments from Fed Chair Jerome Powell at Friday’s annual Jackson Hole economic symposium. central bank.
“We expect the market to approach the Jackson Hole meeting of the Fed, fearing an aggressive message that could trigger a sharp risk-off. However, we believe the message will be more nuanced and possibly even reassuring,” said Steve Englander , head of Global FX research and macro strategy for North America at Standard Chartered.
“It is non-negotiable for the Fed to get inflation towards its targets. Chairman Powell will likely state that the Fed will raise interest rates as far as it takes and for as long as it takes to lower inflation.”
No major corporate earnings or economic data coming out of Europe on Monday.