# Tech names drag European stocks lower after brutal session on Wall Street

The losses were contained, though, as a selling frenzy for global bonds eased up. A climb for the U.S. 10-year government bond
TMUBMUSD10Y,
1.482%
above a one-year high of 1.5% on Thursday triggered a rout for stocks, but that yield has since moved back down to 1.45%. The yield on the 10-year Germany bund
TMBMKDE-10Y,
-0.248%
was hovering at just under year highs at 0.274%.

“The fear about the rise in interest rates is that they are likely to choke off the economic recovery,” said Naeem Aslam, chief market analyst at AvaTrade.

European Central Bank Executive Board Member Isabel Schnabel said on Friday that the central bank would need to monitor long-term real rates.

“A rise in real long-term rates at the early stages of the recovery, even if reflecting improved growth prospects, may withdraw vital policy support too early and too abruptly given the still fragile state of the economy,” she said in a virtual conference. “Policy will then have to step up its level of support.”

U.S. stock futures
ES00,
+0.24%

YM00,
-0.03%

COMP,
-3.52%
inched higher, after the worst session since Jan. 29 for the Dow industrials
DJIA,
-1.75%
and a 3.5% slide for the Nasdaq Composite
COMP,
-3.52%,
its worst one-day loss since September.

Europe’s tech stocks were playing catch up to that Wall Street selling, which also spilled over into Asia. Aslam said investors had been moving out of the tech sector and into those more geared to an economic recovery, though Thursday’s selloff was uniform.

In the chip sector, shares of Dutch group ASML Holding
ASML,
-5.92%

ASML,
-1.33%
and STMicroelectronics
STM,
-5.42%

STM,
-0.40%
fell around 1% each. ASM International
ASM,
-1.36%
shares dropped 2%.

Shares of major oil companies BP
BP,
-1.92%

BP,
+1.15%
and Total
TOT,
+0.31%

FP,
-1.53%
were down 1.7% and nearly 1%, respectively, tracking lower crude futures
CL00,
-0.80%

BRN00,
-0.92%
prices.

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Airlines were in focus, with shares of International Conslidated Airlines Group
IAG,
+5.40%
rising 4%. The operator of British Airways, Iberia and other airlines swung to a €6.92 billion ($8.43 billion) net loss for 2020, and said it won’t provide 2021 guidance due to COVID-19 pandemic uncertainty.

Bernstein analysts Daniel Roeska and Alex Irving said IAG reported slightly better-than-expected adjusted earnings before interest and taxes, and it appears to have enough liquidity for summer and cash burn is “low enough.” Rising in tandem were shares of Deutsche Lufthansa
LHA,
+2.90%
and easyJet
EZJ,
+2.57%,
and holiday tour operator TUI
TUI,
+1.70%.

But shares of Norwegian Air Shuttle
NAS,
+0.71%
fell 3%, after the airline said losses surged in the fourth quarter amid rising impairments. The company said it would next week publish a detailed plan to support its future.