Written by Devik Jain and Amruta Khandekar
(Reuters) – European shares fell on Tuesday and continued a sell-off forced by mounting fears of a recession amid severe monetary tightening by central banks, while stocks in London faltered on concerns about a new economic plan.
Germany’s DAX fell to its lowest level since November 2020, while Italy’s MIB pared all gains thanks to Monday’s election easing.
The pan-European Stoxx 600 index closed 0.13% lower at 388.24 points in a volatile session in which it rose as much as 1.3%.
Gains in mining, energy and health care companies offset sharp declines in the banking and utilities sectors.
London’s FTSE slipped as the pound rose from record lows on Monday amid concerns about the impact of the UK’s “mini-budget”.
“The stability of the pound came on the heels of expectations that the Bank of England would tighten monetary policy too much. There is decent room for the central bank to disappoint expectations and if that happens, the pound could resume its slide against the dollar,” said Themos Phyotakis, head of foreign exchange research at Barclays in London.
The STOXX 600 has lost 4.4% over the past four sessions, after negative data on regional economic activity and tight monetary policy by several global central banks escalated fears of an economic slowdown.
In London, the FTSE index fell 0.52% to 6,984.59 points.
In Frankfurt, the DAX index fell 0.72% to 12,139.68 points.
In Paris, the CAC 40 lost 0.27% to 5,753.82 points.
In Milan, the Ftse/Mib index fell 1.16% to 20,961.38 points.
In Madrid, the Ibex-35 index registered a decline of 0.84% at 7,445.70 points.
In Lisbon, the PSI20 index rose 0.52% to 5443.99 points.
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