European Stock Markets Steady After Wednesday’s Sharp Sell-off

Posted Thursday, August 15, 2019 by
Arslan Butt • 1 min read

European stock markets are trading steady early on Thursday following a sharp sell-off during the previous day over news of yield curve inversion signalling possible upcoming recession in the global economy. For now, hopes are high that central banks will intervene with easing of monetary policies to protect respective economies.

Rising global trade tensions and weakening economic data releases from leading countries around the world have kept markets on edge of late. The US-China trade war has been dragging on for more than a year now, with no end in sight yet.

On Wednesday, European stocks fell to trade at six-month lows after the yield on the 30-year US Treasury bonds fell lower than the yield on the 10-year Treasury note. The last time this happened was back in 2007, and markets see this phenomenon of yield curve inversion as a telltale sign of an impending recession in the economy.

European stock markets had also slid lower following reports which revealed that the German as well as Eurozone GDP had slowed down in the second quarter of this year. In addition, Brexit uncertainties and the ongoing political turmoil in Italy are also pressuring European financial and stock markets in recent times.

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