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European stocks mostly weaken; sentiment hit by tech-led weakness on Wall Street

Published 06/25/2024, 03:18 PM
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Investing.com - European stock markets mostly weakened Tuesday, with sentiment hit by the overnight selloff of influential Big Tech stocks on Wall Street.

At 03:10 ET (07:10 GMT), the DAX index in Germany traded 1.1% lower, the CAC 40 in France fell 0.7%, while the FTSE 100 in the U.K. climbed 0.1%.

Confidence hit by tech selloff on Wall Street

Investors’ confidence has been hit Tuesday after the sharp losses to the Big Tech sector on Wall Street overnight, with the Nasdaq Composite index closing almost 200 points, or 1,1% lower.

Nvidia (NASDAQ:NVDA) bore a brunt of the selling, falling 6.7% and tumbling for a third straight session after it briefly became the most valuable company on Wall Street last week. 

Still, Nvidia is up about 138% so far this year, with analysts remaining positive on the stock in the face of a massive artificial intelligence-driven demand boom. 

The Big Tech sector has been behind a lot of the gains on Wall Street over the last year or so, but the hefty gains have stirred concerns that the tech rally might be getting stretched.

Politics in the spotlight

The European data calendar is largely empty Tuesday, with Spanish growth numbers for the first quarter the only data of significance.

Spanish gross domestic product rose 0.8% in the first quarter, an annual rise of 2.5%, slightly better than the first estimate.

Geopolitics will also be on investors’ radar, with the first round of voting in France's snap elections looming this weekend.

European markets, and French, in particular, were hit hard by the growth of the far right in the European Parliament elections, which prompted the announcement of the French poll.

For now, the far right's overtures to the markets have been effective in allaying fears about a lack of fiscal restraint, but this could easily change.

Across the pond, President Joe Biden and former President Donald Trump will face off in the first presidential debate of the 2024 general election on Thursday.

Crude stable ahead of US inventories 

Crude prices steadied Tuesday ahead of the release of the latest information regarding U.S. crude inventories during the summer driving season. 

By 07:10 ET, the U.S. crude futures (WTI) traded 0.1% lower at $81.58 per barrel, while the Brent contract dropped 0.1% to $85.09 per barrel.

Both benchmarks rose about 3% last week, marking two straight weeks of gains, boosted by increased demand as the U.S., the world's biggest oil consumer, enters the peak summer consumption period.

The American Petroleum Institute is set to release its forecast of U.S. crude oil stockpiles later in the session, ahead of the official report on Wednesday, and stocks are expected to have declined in the week to June 21.

That said, traders are cautious about pushing the market too much higher given interest rates remain relatively high, potentially limiting growth in fuel consumption in the world’s largest economy.

 

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