European stock markets traded sharply lower Tuesday, following the previous session’s tech-led selloff on Wall Street as investors increasingly turned their attention onto inflation data.
At 4:10 AM ET (0910 GMT), the DAX in Germany traded 1.9% lower, the CAC 40 in France fell 1.8%, and the U.K.’s FTSE 100 dropped 2.1%.
European tech shares tumbled to their lowest level since late March, while miners handed back some of their strong gains in the previous session.
Thyssenkrupp (DE:TKAG) stock fell over 5% after the German conglomerate posted a second-quarter net loss but raised its full-year outlook for the second time in three months, boosted by a global economic recovery that drove demand for steel, car parts and materials.
E.ON (DE:EONGn) stock fell 1.1% despite Europe's largest energy networks operator posting a 14% rise in first-quarter operating earnings and confirming its outlook and dividend policy.
NatWest (LON:NWG) stock dropped 3.5% after the British government completed the sale of 1.1 billion pounds ($1.55 billion) in shares of the bank, lowering its stake to below 55% in the lender it bailed out over a decade ago.
This followed the tech-heavy Nasdaq Composite slumping 2.6% on Wall Street on Monday, with investors turning their backs on longer-duration growth stocks amid ongoing inflation pressures.
China's factory gate prices added to these concerns earlier Tuesday, as they rose at the fastest rate in three and a half years in April.
German inflation could climb above 3% as the economy recovers from the pandemic, according to ECB Executive Board member Isabel Schnabel in an interview Tuesday, but it won’t last and the European Central Bank will look beyond such volatility.
Italian industrial production data didn’t help the tone in Europe, with the March monthly figure falling 0.1%, compared with the expected gain on 0.4%. Germany’s ZEW survey of economic sentiment for May is due later in the session, and is expected to show an improvement in confidence in the Eurozone’s most important economy.
Oil prices slipped Tuesday, with the markets seemingly expecting only minor localized disruption to U.S. supplies from Friday’s cyber attack on a major pipeline operator.
Colonial Pipeline, the largest fuel pipeline in the United States, said Monday it expects to "substantially" restore operational service by the end of the week. Already segments of its Texas-to-New Jersey line are being brought back online, easing some of the most immediate concerns that the major population centers on the U.S. East Coast could be affected.
U.S. crude futures traded 1.1% lower at $64.19 a barrel, the Brent contract fell 1.1% to $67.58, while Gasoline futures on the New York Mercantile Exchange dropped 0.9% to $2.1140 a gallon.
Later in the session, the Organization of Petroleum Exporting Countries will publish its monthly oil market report, which will include April production numbers for the group, along with their latest outlook on the market.
Additionally, gold futures fell 0.1% to $1,836.45/oz, just off a three-month high, while EUR/USD traded 0.2% higher at 1.2147.