European Stocks Fall as Nvidia Results Loom, AI Sector Concerns Mount
European stock markets experienced a broad decline today, November 18th, as investors braced for Nvidia’s earnings report and anxieties surrounding the artificial intelligence sector persisted. The downturn reflects broader market nervousness regarding the timing of potential interest rate cuts by central banks, with upcoming data releases on industrial production and the American labor market closely watched for clues. The euro held steady against the dollar at 1.1590, while Bitcoin rebounded slightly to $90,551.
The Stoxx 600 index closed down 1.1%, with Madrid leading losses at -1.4%, followed by Paris (-1.3%), Frankfurt (-1.1%), and London (-0.8%). Banking stocks were notably hard hit, falling 1.9%, including a 1.5% drop for Credit agricole amidst the unveiling of its strategic plan. Insurance companies also declined, down 1.4%, alongside losses in the automotive (-2%) and luxury goods (-1.6%) sectors. Energy stocks decreased 1.2% as oil prices weakened, with WTI crude falling 0.4% to $59.62 a barrel and Brent crude declining 0.3% to $63.94. Utility stocks saw more limited losses (-0.6%), supported by a 1.2% increase in gas prices to 31.82 euros per megawatt hour.
Government bond markets remained largely stable. The spread between Italian and german 10-year bonds held at 75 basis points, with Italian yields at 3.44% and german yields at 2.69%. The spread between Italian and French bonds was negligible, with French 10-year yields also at 3.44%. These movements come amid warnings about potential market instability, including recent comments from Google CEO Sundar Pichai, who cautioned that ”no one is safe from a possible bubble burst.”
