European stocks fall at the open on increasing recession fears

European shares opened lower on Wednesday, led by heavy selling in Asian markets as the escalating energy crisis in the region and the continued rise in global bond yields fueled fears of a recession.

The European Stoxx 600 index fell 0.8 percent by 0707 GMT, to continue its decline for the fifth consecutive session, and the German DAX index lost 0.9 percent in line with Wall Street, whose indices witnessed a further decline last night.

All sector indices declined, with the gas, oil, banking and basic resources sectors declining between 1 percent and 1.5 percent.

Technology stocks came under pressure due to a rise in US 10-year Treasury yields by more than 4 percent to a 12-year high, amid market fears that the Federal Reserve would be forced to raise interest rates by more than 4.5 percent in its efforts to combat inflation.

The FTSE 100 index of London-listed shares fell 0.9 percent after Moody’s warned that Britain’s unfunded tax cuts would have a “negative” impact on the country’s credit situation.

Commerzbank fell 2.1 percent after the German bank said it would make 490 million euros ($469 million) in operating profit in the third quarter after its Polish electronic banking unit booked additional provisions for its Swiss franc loans.

Media for Europe fell 2.2 percent after Italy’s major commercial broadcaster reported a 44 percent drop in operating profit in the first half of the year on the back of fixed advertising sales and rising energy costs.