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Brussels explosions negatively impact global financial markets

By Andrew V. Pestano Follow @AVPLive9 Contact the Author   |   March 22, 2016 at 7:04 AM
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BRUSSELS, March 22 (UPI) -- Global stock markets fell Tuesday in the wake of a series of explosions in Brussels that killed at least 23 people.

Brussels, the Belgian and de facto European Union capital, was bombed three times -- twice in the Zaventem airport and once more at Maelbeek metro station, which is close to EU institutions. The airport is closed, and train and subway services in the city have been suspended.

All European markets opened lower in the wake of the explosions. Germany's DAX and France's CAC 40 opened nearly 1 percent lower and hovered at half a percent lower or less by midday of trading. Britain's FTSE 100 is down 0.42 percent.

The British pound dropped against fellow currencies perhaps out of fear the Brussels explosions could hasten a possible British exit from the European Union.

"It's certainly a flight-to-quality bid in the wake of that news," Richard McGuire, London-based head of rates strategy at Rabobank International told Bloomberg News. "It was the breaking news this morning that informed this risk-off tone. U.S. stock futures are pointing to a modestly risk-off tone."

The largest impact was felt by European airline, airport and hotel companies. Multiple airlines, including British Airways operator IAG, Lufthansa and Air France-KLM, have seen stock prices drop by up to 4.5 percent. Hotel groups are seeing stocks drop from 2 percent up to 4 percent. The Fraport airport operator is seeing stock drops of 2 percent and shares in Aeroports de Paris are down about 4 percent.

In the United States, stock market futures are down at least 0.4 percent for the S&P 500, at least 0.44 percent for the NASDAQ and at least 0.3 percent for the Dow Jones Industrial Average.

Stock markets in Asia are having mixed reactions to the global financial response to the Brussels attacks. Japan's Nikkei 225 is up 1.94 percent while Hong Kong's Hang Seng Index is down 0.08 percent.

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