French, Spanish and Italian stock markets fall

Spain’s IBEX down 1% after ruling PP battered in elections

People celebrate the results of leftist parties at the townhall square after the Spanish regional and local elections in Valencia, Spain

People celebrate the results of leftist parties at the townhall square after the Spanish regional and local elections in Valencia, Spain

 

European stock markets edged lower early on Monday, tracking losses in the US market after Federal Reserve Chair Janet Yellen indicated that the central bank was poised to raise interest rates this year.

US shares fell on Friday after Ms Yellen said the economy was on course to bounce back from a sluggish first quarter and headwinds at home and abroad had started to wane. She said that delaying a policy tightening until employment and inflation hit its targets risked overheating the economy.

The benchmark French CAC 40 index was down 0.4 per cent. Trading volumes in Europe were expected to be thin as several markets in countries including the United Kingdom, Germany and the United States were shut for holidays.

Spain’s IBEX fell 1 per cent after the ruling People’s Party took a battering in regional and local elections on Sunday after voters punished prime minister Mariano Rajoy for four years of severe spending cuts and a string of corruption scandals.

Italy’s FTSE MIB also fell 1.4 per cent, with shares in Fiat Chrysler Automobiles down 2.5 per cent after the New York Times reported on Saturday that the company’s chief executive Sergio Marchionne sent an email to General Motors co-chief executive Mary Barra in March suggesting combining the carmakers, but was rebuffed.

Reuters