European markets saw a significant downturn on Thursday. Germany's DAX index fell 1.61% to 23,815, while France's CAC 40 and Spain's IBEX 35 declined 1.49% and 1.38%, respectively. Selling pressure was exacerbated by a spike in sovereign bond yields, which increased the opportunity cost of holding equities. The S&P 500 edged down 0.2% to 6,856, while the tech-heavy Nasdaq Composite slipped 0.2% to 22,759. Despite the broader sell-off, Broadcom shares surged 4% to $330.07 following a first-quarter earnings beat for fiscal 2026. Richmond Fed President Tom Barkin warned that rising oil prices fueled by the conflict could stoke inflationary pressures, though he noted the Fed's response would hinge on the broader economic fallout. The pan-European STOXX 600 tumbled 1.29% to 604 points, with losses spanning most sectors led by a retreat in major benchmarks. In London, the FTSE 100 dropped 1.45% to 10,413. The resilience in the labour market remains a focal point for traders ahead of Friday’s non-farm payrolls report.
Risk-Off Sentiment Hits Europe European bourses also finished in the red as risk aversion persisted. Separately, ECB meeting minutes from February—recorded prior to the recent conflict—indicated that policymakers still anticipate inflation to trend back toward the 2% target. Germany’s 10-year yield, the regional benchmark, rose 8.8 basis points to 2.845%.
U.S. stocks closed lower on Thursday as investors weighed hawkish signals from Federal Reserve officials against escalating geopolitical risks in the Middle East. The Dow Jones Industrial Average shed 336 points, or 0.7%, to end at 48,403. On the data front, initial jobless claims for the week ending Feb. 28 remained steady, defying consensus estimates of a rise to 215,000.
