Source: Sharecast
The pan-European Stoxx 600 benchmark finished 0.3% lower at 645.78, with losses seen all major indices.
However, stocks bounced off their lows after dovish comments from Federal Reserve policymaker John Williams, who said elevated bond yields reflected a strong economy rather than inflationary risks.
"John Williams’ stance has helped to soothe nerves today," said Chris Beauchamp, chief market analyst at IG. "A soft ADP figure helped too, and now all eyes are on Friday’s payrolls to back up the view.”
Bond yields across Germany, Italy, Spain and the UK were firmly higher, with 10-year yields in Germany and the UK at their highest since 2011 and 2007, respectively, as Brent crude rose a further 0.9% to a six-week high of $95.53 a barrel.
The recent jump in government borrowing adds fresh pressure to rate‑sensitive sectors, weighing on equity sentiment as policymakers face tougher fiscal choices amid rampant inflation.
Oil prices rose after the Islamic Revolutionary Guard Corps said it had fired ballistic missiles at a US military base in Jordan and Iranian state media reported a large-scale drone attack on an American base in Bahrain. It added that the US attacks would further restrict traffic through the vital Strait of Hormuz.
In equity news, Lottomatica shares slumped after the Italian gaming group agreed an all-share merger with Spain’s Cirsa that would create the world’s second-largest listed gaming and sports betting operator.
Under the proposed cross-border merger, Cirsa will be absorbed into Lottomatica, with Cirsa shareholders receiving 0.668 newly issued Lottomatica shares for each share held. Cirsa shares surged 18% on the news.
In London, Pearson was under the cosh after Citi downgraded its stance on the educational publisher to ‘neutral’ from ‘buy’ on valuation grounds following a circa 40% rally in the shares since the February low.
Oil giant BP was in focus as it announced that Ian Tyler has been appointed chairman, though the stock finished flat. Tyler joined the board as a non‑executive director in April 2025 and became interim chair in May 2026.
