European markets concluded lower on Tuesday as investors evaluated incoming corporate earnings reports and a significant U.S. inflation print.
The Stoxx 600 index wrapped up the session down 1%, exacerbating earlier weakness. A 2.7% drop in the tech sector led the declines, with financial services stocks also losing 1.7%.
The losses deepened following the release of new figures indicating that U.S. inflation surged more than anticipated in January, with persistently high shelter prices putting pressure on consumers.
The headline consumer price index rose by 0.3% month-on-month and 3.1% annually, according to the Bureau of Labor Statistics, surpassing a Dow Jones consensus forecast of 0.2% for the month and 2.9% year-on-year.
The unexpectedly high print suggests that the U.S. Federal Reserve might adopt a more cautious approach to cutting interest rates as swiftly and sharply as the market anticipates.
Despite notable fluctuations in individual stocks as corporate results are disclosed, the regional Stoxx index has seen subdued activity thus far in February, following a robust finish to January.
This is occurring despite significant movements in individual stocks as company results are reported. This week will witness earnings reports from several major European corporations, including Heineken, Airbus, Renault, NatWest, and Commerzbank.
Investors may particularly focus on consumer stocks and their implications for the strength of specific economies, as central banks keep a close eye on the trajectory of growth and inflation.
