European stocks slumped to three-week lows on Tuesday as a resurgence of Covid-19 cases and rate hike concerns knocked sentiment ahead of flash readings on euro zone business activity.
The pan-European STOXX 600 dropped 1 per cent by 0815 GMT, after Asian markets followed Wall Street lower on Federal Reserve Chair Jerome Powell’s renomination, which buoyed bets on U.S. rate hikes in 2022.
Tech stocks plunged 2.5 per cent as prospect of a high-rate environment dented appeal of the high-growth sector.
Travel stocks slipped 0.9 per cent after the United States issued an advisory against movement to Germany and Denmark due to rising Covid-19 cases, while oil stocks slid 0.3 per cent tracking a dip in crude prices on growing expectations that the U.S., Japan and India will release crude reserves to tame prices.
Overall, growing nerves around a fourth wave of Covid-19 infections stalling European economic recovery at a time when central banks are planning the withdrawal of monetary support pulled investors out of equities.
Germany’s Thyssenkrupp slumped 6.9 per cent on news that Swedish activist fund Cevian is placing a 6.9 per cent stake in the firm, Refinitiv news service IFR reported.
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