European stocks slide on Russia-Ukraine tensions; Germany’s DAX down 2%

LONDON — European markets pulled back sharply on Monday as investors continued to track tensions in Ukraine and remarks from U.S. Federal Reserve officials about the interest rate outlook

The pan-European Stoxx 600 slid 1.8% by early afternoon, paring some of its earlier losses. Travel and leisure stocks fell 3% to lead losses as all sectors and major bourses slid into negative territory

Multiple countries have urged their citizens to leave Ukraine amid fears of an imminent Russian invasion, with U.S. President Joe Biden’s national security advisor Jake Sullivan warning on Sunday that the Kremlin has accelerated its extraordinary military buildup along the country’s border over the past 10 days

Western leaders have threatened severe sanctions against Russia in the event of any incursion into Ukraine, as leaders continue to pursue diplomatic solutions. The Kremlin has denied any intention to invade its neighbor, accusing Washington of stoking “hysteria

Russian assets retreated sharply on Monday morning initially, but pulled back much of its earlier losses by mid-afternoon. The MOEX Russia Index was last down 1% and the RTS Index 1.4%. The U.S. dollar reversed course against the Russian ruble and was down more than 1% by afternoon trade

Global markets have been in turmoil since a surprisingly high U.S. inflation print last week, which prompted St. Louis Fed President James Bullard to call for a full percentage point of interest rate hikes before July

However, fellow rate-setter and San Francisco Fed President Mary Daly said on Sunday that the central bank should be measured in its path to monetary policy tightening, noting that “abrupt and aggressive action can actually have a destabilizing effect” on growth and price stability

Earnings continue to drive individual share price action in Europe, with Capgemini, Michelin and BHP among those reporting before the bell on Monday

Swiss chemicals company Clariant plunged more than 16% after delaying its 2021 earnings report amid an investigation into whistleblower allegations about its accounting practices

Commerzbank shares fell 4% after German Finance Minister Christian Lindner told Handelsblatt newspaper that the government would shed its stake in the bank in the long run

Shares in Asia-Pacific pulled back on Monday, with Japan leading losses as investors assessed both Ukraine tensions and the worsening Covid-19 situation in Hong Kong. U.S. stock futures also fell in early premarket trade