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European stocks hits lowest in nearly a month on looming energy crisis

Energy stocks boost European shares ahead of ECB minutes; DAX jumps after GDP data
Energy stocks boost European shares ahead of ECB minutes; DAX jumps after GDP data   -   Copyright  Thomson Reuters 2022   -  
By Reuters

<div> <p>By Anisha Sircar and Shreyashi Sanyal</p> <p> -European shares fell to their lowest level in nearly one month on Monday as worries about tightening gas supplies from Russia, hawkish signals from the European Central Bank and weak economic outlook weighed on investors’ minds.</p> <p>The continent-wide <span class="caps">STOXX</span> 600 dropped 1.0% to touch its lowest level since July 28. </p> <p>Russia will halt natural gas supplies to Europe for three days at the end of the month, energy giant Gazprom said on Friday, piling pressure on the continent as it seeks to refuel ahead of winter.</p> <p>Uniper, Germany’s top importer of Russian gas, declined 7.7% to hover near a record low, while its parent Fortum fell 4.4%. Germany’s <span class="caps">DAX</span> index tumbled 2.3% for its worst session in nearly seven weeks. </p> <p>“Europe’s energy crisis is just getting bad news all over the board. Heatwaves have put a strain on supplies and it seems any disruptions in the winter could be devastating,” said Edward Moya, senior market analyst at <span class="caps">OANDA</span>. </p> <p>The focus is on euro zone flash purchasing manager index (<span class="caps">PMI</span>) data, due on Tuesday, and minutes of the European Central Bank’s (<span class="caps">ECB</span>) last policy meeting on Thursday that are likely to sound hawkish. [O/R]</p> <p>The <span class="caps">ECB</span> must keep raising rates even if a recession in Germany is increasingly likely, as inflation will stay uncomfortably high through 2023, Bundesbank President Joachim Nagel told a German newspaper.</p> <p>Markets currently price in a 60 basis point hike for September and a combined 130 basis points of moves for the remainder of the year.</p> <p>After rallying more than 11% since mid-June lows, European markets have sagged in recent days as investors fret over the impact of soaring inflation and tightening financial conditions on the economic outlook. </p> <p>Credit Suisse slipped 0.8% to a fresh record low. The Swiss lender appointed Deutsche Bank’s Dixit Joshi as chief financial officer and promoted <span class="caps">EMEA</span> chief Francesca McDonagh to chief operating officer.</p> <p>French supermarket retailer Carrefour fell 0.9% after saying it would freeze prices on 100 products to help people tackle soaring inflation in the country.</p> <p>Shares of world No.2 cinema operator Cineworld plummeted 21.4% after it confirmed a possible Chapter 11 bankruptcy filing in the United States. </p> <p>German sporting goods maker Adidas fell 5.2% as it unexpectedly said Chief Executive Kasper Rorsted would leave his post next year. </p> </div>