European stocks tumbled on Wednesday as investors fretted about energy shortages and Britain’s radical tax cuts to spur growth.
News about the large amount of gas leakage from the Nord Stream pipelines has deepened concerns over energy and the overall economic circumstances in Europe.
The International Monetary Fund has urged the U.K. government to “re-evaluate” a package of unfunded tax cuts, saying it may fuel inflation and would likely increase economic inequality.
Weak consumer sentiment readings from Germany and France also raised concerns about the economic outlook.
The German consumer confidence index plunged to -42.5 in October from revised -36.8 in the previous month, survey results from the market research group GfK showed. The score was weaker than the economists’ forecast of -39.0.
The French consumer confidence index fell to 79.0 in September from 82.0 in August, the statistical office Insee said. Economists had forecast the index to fall to 80.0.
The dollar marched to a new 20-year high and government bond yields surged after several Fed officials reiterated their hawkish stance toward interest-rate hikes.
The pan European Stoxx 600 fell 1.5 percent to 382.61 after closing 0.1 percent lower on Tuesday.
The German DAX lost 1.6 percent, France’s CAC 40 index shed 1.3 percent and the U.K.’s FTSE 100 was down over 2 percent.
Swiss pharmaceutical company Roche soared 5.3 percent as Alzheimer’s drug from rivals Eisai and Biogen showed benefit in a large trial.
Dutch biopharmaceutical company Pharming Group N.V. fell over 1 percent despite news that the U.S. FDA has accepted for priority review its New Drug Application for leniolisib.
British online fashion retailer Boohoo plunged 13 percent after cutting its full-year forecasts.
Burberry Group, a luxury fashion company, rallied 3.6 percent as it announced the appointment of Daniel Lee as new Chief Creative Officer, effective October 3.
German lender Commerzbank AG slumped 6 percent after a warning that its third-quarter operating result would be impacted because of additional provisions at Polish subsidiary mBank.
Conglomerate Thyssenkrupp plunged 12 percent after JPMorgan reinstated its coverage of the stock with an “underweight” rating.
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