European stock markets are posting sizeable falls Monday with investors seemingly anxious over what further stimulus the European Central Bank will provide at its policy meeting later this week. A warning from the Bank for International Settlements over a “gathering storm” in the global economy further weighed on sentiment.
KEEPING SCORE: In Europe, Germany’s DAX fell 1 percent to 9,731 while France’s CAC-40 lost 0.8 percent to 4,419. Britain’s FTSE 100 lost 1 percent to 6,141. Wall Street was headed for losses at the open too, with Dow futures and the broader S&P 500 futures 0.3 percent lower.
BANK WARNING: Contributing to the downbeat start to the week was a warning from The Bank for International Settlements that central banks are running out of policy room and have been “over-burdened” over the past few years. The BIS’s chief economist, Claudio Borio, said market participants have registered that fact and their “confidence in central banks’ healing powers has – probably for the first time – been faltering.” The statement carries some weight coming from an organization that is often referred to as the central banks’ central bank. “We may not be seeing isolated bolts from the blue, but the signs of a gathering storm that has been building for a long time,” Borio added.