European stock market closed flat today as geopolitical risks offset gains in the auto and travel sectors, with some Western countries imposing sanctions on Russia following it ordered its troops into two breakaway regions in eastern Ukraine.
The pan-European Stoxx 600 index ended the trading session unchanged. The auto, travel and technology sectors were the top gainers, while shares of retail and financial companies were among the biggest losers.
Germany has frozen approval of a new Russian gas pipeline, and Britain has imposed sanctions on Russian banks as part of the West’s response to Moscow’s recognition of two breakaway regions in Ukraine.
The German DAX index was the top loser among the major European indexes, as Germany is seen as more vulnerable to damage due to its heavy dependence on Russian gas supplies.
Oil stocks fell 0.1 percent despite a jump in crude prices to their highest level since 2014, as investors fear higher commodity prices will fuel more inflation.
A key index measuring volatility across stock markets in the euro zone fell following touching 39 points, its highest level since June 2020, in the previous session.
The stock index of euro zone banks fell 0.7 percent as investors scaled back their expectations for an increase in interest rates from the European Central Bank in 2022.
Volkswagen rose 7.8 percent, while Porsche jumped 11.3 percent, topping the STOXX 600’s top gainer, following news that the two companies were in advanced discussions regarding a possible initial public offering of luxury car maker Porsche.
