Europe close: Stocks plunge after news that Ukrainian nuclear plant was shelled
European shares plunged on Friday after Russian troops seized a Ukrainian nuclear plant after shelling it and setting a building in the complex on fire.
The pan-European Stoxx 600 index was down 3.56% with all major regional bourses lower. Asian stocks were all lower overnight with Wall Street having started the last session of the week lower.
The blaze at the site of Europe's biggest nuclear power station hit sentiment hard. The fire was later extinguished and officials said the plant was operating normally with no damage to the reactor.
"Markets in Asia have taken another leg lower this morning after reports that one of Ukraine’s nuclear power stations, at Zaporizhzhia had caught fire after being shelled by Russian forces," said CMC Markets analyst Michael Hewson.
"Putting to one side that it takes a special kind of stupid to start firing on a nuclear power station, it’s doubly incomprehensible and reckless given Russia’s experience with Chernobyl nearby, and the potential impacts on Russia itself, as well as Europe, from any potential fallout.
"The environmental damage in that region alone has rendered the agricultural land there unusable for years, and further damage from another nuclear meltdown would be catastrophic. Early reports suggest the fire is under control but as an indication of the lengths Russia will go to achieve its goals, it’s an even more worrying development, sending wheat and corn prices soaring."
Oil prices surged again, almost hitting $120 per barrel on the news before Brent crude wound back to $113.53 and US crude $110.81 a barrel. There were also spikes in commodities such as nickel, copper and aluminium as the escalation of sanctions on Russia threatened general supply chains.
Shares in German utility Uniper fell 12% over concerns about its exposure to Russia, which mainly consists of a 83.7% stake in local utility Unipro. The group, which is majority-owned by Fortum, is also a co-funder of the Nord Stream 2 pipeline and a main recipient of Russian energy giant Gazprom's gas supplies.
Michelin shares fell after the French tyre maker said it would temporarily halt production at some of its plants in Europe due to logistical issues.
Airlines were under pressure, with BA and Iberia owner IAG, Wizz Air and easyJet all sharply lower. Other travel-related shares also sank, with cruise operator Carnival, travel firm Tui and Upper Crust owner SSP all down.
Broadcaster ITV was on the back foot again after a downgrade to 'equalweight' from 'overweight' at Barclays.
Russian gold miner Polymetal lost more ground, having already been battered since the invasion.