European shares took a nosedive today as concerns over China’s economic growth cast a dark shadow on investor confidence. The mood has been tense due to uncertainties surrounding the future monetary policies of major central banks.
The STOXX 600 index, which represents the collective performance of European stocks, stumbled by 0.4% as of 7:02 GMT. Tuesday’s trading session had been relatively calm since the U.S. markets were closed in observance of Independence Day.
A private-sector survey released today revealed that China’s services sector expanded at its slowest pace in five months during June. This report adds to a mounting pile of data signaling weakness in the world’s second-largest economy, still grappling with the aftermath of the pandemic.
Miners faced a considerable setback, falling 1.0% and emerging as the hardest-hit sector. The decline stems from concerns about weakened demand from China, the largest consumer of metals, as well as sluggish growth in other major economies.
Even luxury companies with exposure to the Chinese market felt the pinch. LVMH, Europe’s most valuable company by market capitalization, witnessed a 0.4% decline. Similarly, Kering (EPA:PRTP), Pernod Ricard (EPA:PERP), and Hermes experienced dips ranging from 0.3% to 0.9%.
Overall, the European shares market finds itself grappling with China’s economic slowdown. The impact of this concern, coupled with sluggish growth in other global economies, is taking a toll on investor confidence, putting a damper on the trading atmosphere.
