Connect with us

Tech

European stocks extend losing streak as IT outage disrupts key sectors

Published

on

European stocks extend losing streak as IT outage disrupts key sectors

European stocks extended their losses on Friday as a global tech outage disrupted banks, airlines, and sectors globally, marking the longest losing streak since October 2023.

ADVERTISEMENT

European stock markets extended their losses on Friday, suffering the longest losing streak since October 2023, as a tech outage caused by “defective” Crowdstrike software triggered issues with customers of Microsoft’s Azure and Office365 services, which subsequently disrupted banks, airlines, and various other sectors across the globe.

By 11.45 a.m. CET, the Euro STOXX 50 index had fallen 0.5%, and the Euro STOXX 600 index was down 0.6%, marking the fifth straight session of losses for European stocks.

All major country indices were in negative territory, with the German DAX down 0.8%, the Italian FTSE Mib down 0.7%, the French CAC 40 down 0.7%, and the Spanish Ibex 35 down 0.3%.

Disruptions in travel and shipping industries

Air France-KLM’s Dutch arm halted most operations, leading to a 1.1% drop in its shares. German flag carrier Lufthansa Group saw a 1.5% decline in its shares, cautioning about potential delays and flight cancellations.

In Hungary, Budapest Airport was among the affected hubs. Eurowings, Ryanair, and Wizz Air experienced check-in system failures, causing “delays, congestion, and significantly increased waiting times,” according to an airport statement.

Shares of low-cost companies Ryanair and Wizz Air fell by 2.9% and 2.1%, respectively.

At Rotterdam The Hague Airport in the Netherlands, check-in services were unavailable, resulting in long queues.

The Baltic Hub Container Terminal at Poland’s Gdansk docks is experiencing issues “hindering the functioning of the terminal.”

Danish shipping giant A.P. Møller – Mærsk A/S saw its shares decrease by 2.8%, while Hamburg-based Hapag-Lloyd AG dropped by 4.1%.

Impact on European banks

European banks also recorded losses, although less severe than those in the travel and shipping sectors.

French banks BNP Paribas, Societe Generale, and Credit Agricole dropped by 1%, 0.9%, and 0.7%, respectively. Spanish banks Banco Santander, BBVA, and Bankinter declined by 1.2%, 0.8%, and 0.7%, respectively.

In Germany, Deutsche Bank AG shares fell by 1.5%, marking their tenth negative session in the last eleven, while Commerzbank shares rose by 0.4%.

Italian banks Intesa Sanpaolo eased by 0.4%, while Unicredit remained unchanged. Dutch banks ING and ABN Amro fell by 1% and 0.8%, respectively.

European bonds steady, euro and pound weaken

In the bond market, yields held broadly steady with Bund yields down by a marginal 1 basis point to 2.43%.

The euro eased with the euro-dollar exchange rate down 0.1% falling to 1.0880, on track for the second straight negative close. The British pound was 0.3% lower to 1.2910.

ADVERTISEMENT

US cybersecurity giant CrowdStrike plummets

American cybersecurity firm CrowdStrike Holdings dropped more than 20% in pre-market trading after an update to its cloud platform caused disruptions to Microsoft’s Azure systems worldwide.

This decline would represent CrowdStrike’s worst daily performance since its initial public offering in 2019.

Crowdstrike CEO George Kurtz said in a post on social media X that “this is not a security incident or cyberattack. The issue has been identified, isolated and a fix has been deployed.”

Meanwhile, competitors in the cybersecurity sector saw gains, with SentinelOne, Palo Alto Networks, and Cloudflare rising by 10%, 5%, and 2%, respectively.

ADVERTISEMENT

Addressing the issue, a Microsoft spokesperson stated: “We’re aware of an issue affecting Windows devices due to an update from a third-party software platform. We anticipate a resolution is forthcoming.”

Continue Reading