European Shares Retreat As Gas Prices Surge

Business

European stocks tumbled on Monday after Russia extended a halt on gas flows through a major pipeline to Europe, sparking further fears of energy rationing in the region as winter approaches.

Moscow was reacting to a decision announced Friday by the Group of Seven finance ministers to cap the price of Russian oil.

European gas prices soared 30 percent in early trading today as the energy crisis threatened to turn into an economic and financial crisis.

Disappointing service sector activity data from the region, a weak reading on Sentix’s investor confidence, disappointing Eurozone retail sales figures and anxiety ahead of the announcement of a new U.K. prime minister later in the day also weighed on sentiment.

The upcoming ECB meeting also remained in focus, where a landmark decision is expected.

The pan-European Stoxx 600 fell 1.4 percent to 410.19 after rallying 2 percent on Friday. The German DAX lost 2.8 percent, France’s CAC 40 index shed 2 percent and the U.K.’s FTSE 100 was down 0.8 percent.

Swedish conglomerate Assa Abloy fell over 1 percent after it signed an agreement to acquire Control iD in Brazil.

Zurich Insurance Group was down around 1 percent after saying it intends to exercise its option to redeem 450 million pounds ($515.93 million) of subordinated debt.

Sanofi shares declined 1.3 percent. The French drugs group said it plans to name outgoing Société Générale boss Frédéric Oudéa as chair to replace veteran private equity executive Serge Weinberg at the next shareholders meeting.

Shares of Countryside Partnerships surged 6 percent in London. The company said it has reached agreement to be acquired by Vistry Group PLC (VTY.L) in around 1.25 billion pounds cash and stock deal.

Aston Martin Lagonda Global Holdings plummeted 13 percent. The luxury motor vehicle manufacturer announced a heavily discounted rights issue to help pay off debt and support future growth.

Energy stocks climbed as oil prices jumped more than $2 a barrel ahead of an OPEC+ meeting to decide on supply. BP Plc gained 1 percent and Shell added half a percent.

Volkswagen slumped 2.5 percent. The German automaker said that its management and supervisory boards will meet on 5 September 2022 to discuss whether a potential initial public offering of sports car brand Porsche should go ahead in late September or early October 2022.

Utilities plunged, with Uniper tumbling 11 percent, RWE losing 3.2 percent and E.ON declining 1 percent.

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