Inflation shock drives European stocks to fifth day of losses

Asian stocks tumbled more than 2%, also hit by a COVID-19 warning from Beijing. Stock markets took cues from a sharp Wall Street sell-off on Friday after data showed the U.S. CPI surged 8.6% in May, its biggest gain since 1981. Cyclical sectors such as travel & leisure, automakers and oil & gas led morning losses in Europe on fears about a slowing global economy.

European stocks fell for a fifth straight session on Monday, dragged down by economically sensitive stocks, as a sharp rise in U.S. inflation raised concerns about aggressive interest rate hikes by the Federal Reserve.

The pan-European STOXX 600 index fell 1.1% by 0712 GMT, hitting a fresh one-month low. Asian stocks tumbled more than 2%, also hit by a COVID-19 warning from Beijing. Stock markets took cues from a sharp Wall Street sell-off on Friday after data showed the U.S. CPI surged 8.6% in May, its biggest gain since 1981.

Cyclical sectors such as travel & leisure, automakers, and oil & gas led morning losses in Europe on fears about a slowing global economy. Eurozone banks were down 2.8% on disappointment that the European Central Bank did not reveal any tool to support peripheral bonds at its meeting last week.