Major indices fell 1-2% Friday as surging sovereign yields weighed on equities, pushing weekly declines into negative territory.
European equities closed sharply lower, with the FTSE 100 down 1.71% and the German DAX shedding 2.07%. The declines extended weekly losses, leaving the DAX and France’s CAC 40 down 1.59% and 1.97%, respectively, for the five-day period.
The sell-off was driven by a surge in sovereign bond yields, which reached multi-year highs. Germany’s 10-year yield rose +17.4 basis points to 3.170%, its highest since May 2011, while France’s yield climbed +35.7 basis points to 3.969%, a level not seen since May 2009.
Other major markets followed suit, with Spain’s Ibex dropping 1.05% and Italy’s FTSE MIB falling 1.87%. The UK’s FTSE 100 ended the week down 0.37%, its smallest decline among the group.