European markets retreated Thursday morning as a rise in bond yields saw jitters return to global stocks once again.

The pan-European Stoxx 600 shed 0.7% by mid-morning trade, with basic resources dropping 3.9% as most sectors slid into the red. Utilities bucked the downward trend to climb 0.6%.

European stocks received a weak handover from Asia-Pacific, where Japan’s Nikkei 225 and Hong Kong’s Hang Seng index dropped more than 2% to lead losses as the 10-year U.S. Treasury yield rose again. The yield stabilized a little Thursday morning, however, and was last seen at 1.4671%.

U.S. stock futures are also pointing to further losses at Thursday’s market open, accelerating Wednesday’s declines for major indexes as yields climbed. Last week, the 10-year yield surged to a high of 1.6% in a move that some described as a “flash” spike, but which sparked fears about stock valuations and rising inflation.

Tech stocks have been the major casualty of the retreat, with investors pivoting to stocks seen as having potential to benefit from an economic recovery, in the wake of Covid-19 vaccination rollouts and progress towards a U.S. fiscal stimulus package.

Investors stateside will be keeping an eye on a speech from Federal Reserve Chairman Jerome Powell later on Thursday for indications as to the direction of growth and inflation.

On the data front, IHS Markit construction PMI (purchasing managers’ index) readings for February are due Thursday morning from the U.K., Germany, France, Italy and the wider euro zone.

It’s another busy day for earnings in Europe, which promises to be a key driver of individual share price action. Thales, Lufthansa, Merck, ProSiebenSat.1 and Aviva were among those reporting before the bell.

Lufthansa posted a smaller-than-expected net loss in the fourth quarter but saw a full-year loss of 6.7 billion-euro ($8.1 billion) in 2020. The airline warned that it will struggle to profit from flights before the end of 2021 as the pandemic continues to hammer air travel demand.

German food processing company GEA Group climbed 3.7% to lead the Stoxx 600 by mid-morning after increasing its profitability in 2020 and projecting revenue and earnings growth in 2021.

Aviva exceeded company expectations to post flat 2020 operating profit of £3.2 billion ($4.5 billion) and sold out of its remaining businesses in Italy to focus on core markets, sending the British insurer’s shares 1.8% higher by mid-morning.

At the bottom of the European blue chip index, Anglo-Australian mining titan Rio Tinto dropped more than 6%, after chairman Simon Thompson announced he would step down over the company’s destruction of a 46,000-year-old indigenous site in Western Australia.

ProSiebenSat.1 shares fell 4.8% after the company projected single-digit revenue growth in 2021 despite a strong fourth quarter.

– CNBC’s Pippa Stevens contributed to this report.

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