UPDATE 2-European shares end lower as miners and tech are pressured by firmer yields

  • Reuters
  • Stock Market News
UPDATE 2-European shares end lower as miners and tech are pressured by firmer yields
Credit: © Reuters.

* UK miners trade ex-dividend

* Lufthansa slips after record 2020 loss

* Tech stocks slide amid semiconductor shortage, Wall St losses

* Unibail-Rodamco-Westfield tops STOXX 600 (Updates to market close)

By Sruthi Shankar and Ambar Warrick

March 4 (Reuters) - European stocks closed lower on Thursday as a renewed rise in U.S. bond yields and expectations of a jump in inflation hit risk appetite, with heavyweight miners and technology stocks leading losses.

The pan-European STOXX 600 index .STOXX fell 0.4%, with miners .SXPP dropping the most among the European sectors. UK-listed heavyweights Rio Tinto RIO.L and BHP Group (JO: BHPJ ) BHPB.L shed 7.7% and 5.8%, respectively, as they traded ex-dividend. stocks .SX8P , the driver of the market's rebound from pandemic-driven lows, fell 3.3% as a global semiconductor shortage weighed on the sector, while a rise in bond yields also spurred more scrutiny of high stock valuations. US/

Dutch firm ASML Holding NV ASML.AS dropped 6.1% despite news that it had extended a deal to sell chip manufacturing equipment to China's largest chipmaker SMIC 0981.HK . one can understand why investors are concerned about valuations in the U.S., particularly around the tech sector ... the same can't be said in Europe, where valuations are much lower," Michael Hewson, chief market analyst at CMC Markets wrote in a note.

Unlike U.S. stocks, the STOXX 600 has yet to reach pre-pandemic highs, as a fresh round of lockdowns and sluggish economic growth cut short an early bounceback from lows hit last March.

Market participants were also waiting for comments from Federal Reserve Chairman Jerome Powell regarding the recent jump in borrowing costs. Central Bank policymaker Klaas Knot said the recent rise in euro zone borrowing costs may reflect improved growth and inflation prospects. steepening curve is to some extent a sign that monetary policy is bearing fruit," analysts at Rabobank wrote in a note. "However, (the ECB) are also wary that too rapid an increase could stop the fragile recovery in its track."

Euro zone bond yields are significantly lower than those in the United States, with many investors welcoming the recent rise in yields as signs of economic reflation.

Sefensive sectors such as utilities .SX6P , food & beverage .SX3P and real estate .SX86P all advanced.

Among individual movers, Unibail-Rodamco-Westfield URW.AS - Europe's biggest retail property owner - topped the STOXX 600 after French tycoon Xavier Niel raised his stake in the firm. broadcaster Prosiebensat.1 Media PSMGn.DE fell 7.3% after forecasting that revenue and profits would grow in single digits this year, after a strong showing in the fourth quarter. airline Lufthansa LHAG.DE slipped 3% as it posted record losses for 2020 and trimmed its 2021 capacity plans as COVID-19 disruption drags on.

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