Equities Indices

European shares fall as US bond yields remain high

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European shares are lower Friday, as US bond yields remain high amid expectations that bullish comments from the US Fed will continue to be supported by key economic data releases, like the payrolls figures, Friday.

A fresh spat between the US and China is also weighing on sentiment.

By 1335 BST, the EUROSTOXX 600 was off 0.58%, while the EUROSTOXX 50 lost 0.47%. Regional bourse are also lower. The German DAX was 0.80% in the red, the French CAC fell 0.54% and the Spanish IBEX was down 0.47%.

Strong US economy

Following the surge in US bond yields Thursday, they have hit around a seven-year high Friday, as investors increasingly expect at least four more rate hikes between now and the end of 2019.

Further cementing the upbeat US economic view, were the latest payrolls figures, which rose 134,000 in September, a little below expectations. Wage growth was reported at 2.8%, in line with forecasts. The US jobless rate, meanwhile, fell by more than expected, to 3.7%, the lowest since 1969

Also weighing on European investor sentiment Friday, was a new, albeit minor, spat between the US and China.

China responded to claims by US Vice President Mike Pence that it was trying to undermine US President Trump, by saying his comments were “unwarranted” and were slanderous towards China.

Stock movers

Among Friday’s notable stock movers are Audi shares, which slipped 0.51%. The luxury German car maker reported a slump in vehicle sales in September from a year. The 55.5% decline across Europe was due to tougher new anti-pollution cars which were limiting the number of units it could register.

Danske Bank shares are lower again Friday, as the Danish bank Thursday confirmed a US criminal investigation into its money laundering offences at its Estonia branch, is ongoing. Danske Bank shares slumped 7.69% to DKK146.40.

And, Kering shares are also in negative territory Friday, following news that demand for luxury goods from China is slowing. Kering shares fell 2.65% to €426.20.

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