European Shares Slide as Fed Hike Bets and Tech Drag Weigh on Markets

European markets opened lower on Tuesday, weighed down by anticipated US Federal Reserve rate hikes and concerns over escalating corporate artificial intelligence investments. The STOXX 600 index suffered a notable decline, with basic resources and tech sectors leading the downturn.

The European bourses’ underperformance came as investors digested the prospect of higher interest rates in the United States, which could dampen economic growth globally. Market participants are also growing increasingly wary of the rising costs associated with AI adoption by major corporations, sparking concerns over their profitability and competitiveness.

According to data from Refinitiv, the tech-heavy NASDAQ Composite index was among the top decliners in Europe, with losses averaging 2.5 percent. The FTSE 100 in London dropped 1.4 percent, while the CAC 40 in Paris shed 1.6 percent. Basic resources and materials companies also suffered significant losses, dragged down by declining commodity prices.

Investors are awaiting key economic data releases from the US and Europe later this week, including June’s non-farm payrolls figures and the European Central Bank’s latest monetary policy decision. These developments will likely influence market sentiment and shape investor expectations for interest rates in the coming months.

Source: original report.