European markets were lower on Monday after U.S. Federal Reserve Chair Jerome Powell signaled higher interest rates would likely persist in a bid to tame soaring inflation.
All sectors and major bourses slipped into negative territory during early morning deals in London. Tech stocks led the losses, down nearly 1.7%.
Germany’s DAX index fell over 1.1%, France’s CAC 40 index dipped around 1.1%, while Italy’s FTSE MIB fell around 1%.
U.K. markets are closed on Monday for a bank holiday.
The market moves come as investors digest comments from Powell at a top central bankers’ conference on Friday.
In his much-anticipated annual policy speech at Jackson Hole, Wyoming, Powell said that the Fed will “use our tools forcefully” to attack inflation that is still running near its highest level in more than 40 years. He acknowledged that rising interest rates will cause “some pain” to households and businesses.
Powell’s comments were echoed by European Central Bank board member Isabel Schnabel over the weekend. Schnabel reaffirmed the view that central banks must act aggressively to tackle rising inflation, even if that means dragging their economies into a recession.
Shares in the Asia-Pacific traded lower on Monday.
Back in Europe, market participants are likely to closely monitor German inflation figures at around 1 p.m. London time.
— CNBC’s Jeff Cox contributed to this report.
Source link: https://www.cnbc.com/2022/08/29/europe-markets-open-to-close-investors-digest-powells-rate-warning.html