Market Analysis

European Stocks Mostly Lower as Tech Weakness on Wall Street Weighs on Sentiment

Amos Simanungkalit · 25 Jun9.1K Views

European stock markets faced declines on Tuesday, influenced by a significant sell-off in Big Tech stocks on Wall Street overnight.

As of 03:10 ET (07:10 GMT), Germany's DAX index was down 1.1%, France's CAC 40 dropped 0.7%, while the UK's FTSE 100 managed a slight 0.1% increase.

Investor confidence took a hit following sharp losses in the Big Tech sector on Wall Street, where the Nasdaq Composite index closed nearly 1.1% lower, shedding about 200 points. Nvidia (NASDAQ: NVDA) particularly suffered, plunging 6.7% over three consecutive sessions despite a robust year-to-date gain of approximately 138%, fueled by strong demand in artificial intelligence.

The robust performance of Big Tech stocks has been a cornerstone of Wall Street's gains in recent times, but concerns have surfaced about the sustainability of this rally.

In Europe, the economic calendar for Tuesday remains sparse, with Spanish GDP data for the first quarter showing modest growth of 0.8%, slightly exceeding initial estimates with an annual increase of 2.5%.

Geopolitical developments, including upcoming French snap elections this weekend, are also weighing on market sentiment. The rise of far-right parties in European Parliament elections earlier had prompted concerns, although recent efforts to reassure markets about fiscal policies have somewhat mitigated these fears.

Meanwhile, attention is also on the upcoming first presidential debate in the 2024 U.S. general election, scheduled between President Joe Biden and former President Donald Trump.

In the oil markets, crude prices stabilized ahead of the release of U.S. crude inventory data, with WTI futures trading slightly lower at $81.58 per barrel and Brent crude at $85.09 per barrel. Recent gains in oil prices have been supported by increased summer demand in the U.S., although concerns about high interest rates potentially impacting fuel consumption growth remain a point of caution for traders.

The American Petroleum Institute is expected to announce its forecast of U.S. crude oil stockpiles later today, preceding the official report scheduled for Wednesday, with expectations of a decline in stocks for the week ending June 21.