By Steve Goldstein
European stocks declined on Tuesday with attention still trained on the isolation of Russia from global financial markets after its invasion of Ukraine.
The Stoxx Europe 600 /zigman2/quotes/210599654/delayed XX:SXXP +1.03% , which ended just 0.1% lower on Monday despite heavier losses early in the day, skidded 2.4%.
Automaker Renault /zigman2/quotes/200919924/delayed FR:RNO +1.72% , German lender Commerzbank /zigman2/quotes/207286669/delayed XE:CBK +2.94% and Irish carrier Ryanair /zigman2/quotes/205429530/delayed IE:RYA +0.10% were among the companies seeing sharp declines.
The German DAX /zigman2/quotes/210597999/delayed DX:DAX +1.26% and the French CAC 40 /zigman2/quotes/210597958/delayed FR:PX1 +1.06% each fell nearly 4%, while the U.K. FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +0.74% lost 1.7%, as the index’s gearing to commodity producers helped limit damage.
While stocks struggled, bonds soared. The yield on Germany’s 10-year bund /zigman2/quotes/211347112/realtime BX:TMBMKDE-10Y +2.04% turned negative for the first time in a month. The yield on the U.K. 10-year gilt /zigman2/quotes/211347177/realtime BX:TMBMKGB-10Y +1.31% tumbled 26 basis points.
Heavy fighting continued in Ukraine, with the country’s second-largest city Kharkiv bombarded. Russia also said it was about to about making missile strikes on Kyiv, the capital. The Central Bank of Russia kept the local stock market closed for a second day after the U.S. barred transactions with it. The central bank on Monday lifted interest rates to 20% from 9.5%.
Rheinmetall /zigman2/quotes/206400421/delayed XE:RHM -0.26% rose for a second day, gaining 18%, after Germany said it would spend €100 billion to boost its armed forces. Thales /zigman2/quotes/206629262/delayed FR:HO -0.62% and BAE Systems /zigman2/quotes/206753913/delayed UK:BA -1.14% also saw a second day of gains.
Oil companies including Aker BP /zigman2/quotes/210393113/delayed NO:AKRBP -1.13% and Equinor /zigman2/quotes/203290881/delayed NO:EQNR +0.77% surged as oil prices /zigman2/quotes/211629951/delayed CL.1 -0.07% spiked.