Tech selloff spreads to European stocks, carmakers up
Europe's main STOXX 600 was down 0.3 per cent by 0825 GMT.
European shares fell on Tuesday as US antitrust action against Google and other major technology companies drove peers in the region lower, although a boost from automakers capped losses.
Europe's main STOXX 600 was down 0.3 per cent by 0825 GMT tracking losses on Wall Street and Asian markets overnight, with the technology sector losing 1.6 per cent.
New York's tech-heavy Nasdaq entered correction territory on Monday as Amazon and Alphabet's Google were the first to face an antitrust probe from regulators, with sources saying Apple and Facebook may follow.
"The United States is starting to cause more red tape on tech companies. This will affect all companies that do business with tech, and that will cause a ripple effect in Europe," said Florian Hense, European economist at Berenberg.
Global stock markets have succumbed to selling pressure in recent weeks, with the benchmark STOXX 600 posting its worst monthly performance in over three years in May.
Weak economic numbers worldwide have pointed to slowing growth and the risk of recession ahead as a trade war between the United States and China escalates.
"As the US president is ratcheting up trade tensions, he is using tariffs to pursue non-economic goals which is worrisome and highlights the risk of a solution being very far away," said Hense.
There was a hint of the risks for the fund management community if a decade-long stocks rally is drawing to a close in the suspension by high-profile fund manager Neil Woodford of his Woodford Equity Income Fund.
Fund supermarket Hargreaves Lansdown, which includes the Woodford fund in six of its Multi-Manager investment packages, fell more than 5 per cent in response, making it the top faller on London's FTSE 100.
A 1.6 per cent jump in auto stocks helped Germany's DAX up 0.2 per cent and Italy's FTSE MIB rise 0.9 per cent after better-than-expected sales numbers from the US market on Monday.
Brokerage RBC also started coverage on Germany's Daimler and Volkswagen with "outperform" ratings, sending their shares up nearly 2.5 per cent each.
Italian banks rose 1.8 per cent, with traders citing conciliatory remarks from Italian Prime Minister Giuseppe Conte on respect of EU rules. The pan-European banking index was up 0.8 per cent.
The ECB holds its next policy meeting on Thursday and is expected to keep settings unchanged though there is growing speculation it could shift to a more dovish footing. Comments from the Federal Reserve on Monday raised expectations the US central bank is moving closer to a rate cut.
Europe's main STOXX 600 was down 0.3 per cent by 0825 GMT tracking losses on Wall Street and Asian markets overnight, with the technology sector losing 1.6 per cent.
New York's tech-heavy Nasdaq entered correction territory on Monday as Amazon and Alphabet's Google were the first to face an antitrust probe from regulators, with sources saying Apple and Facebook may follow.
"The United States is starting to cause more red tape on tech companies. This will affect all companies that do business with tech, and that will cause a ripple effect in Europe," said Florian Hense, European economist at Berenberg.
Global stock markets have succumbed to selling pressure in recent weeks, with the benchmark STOXX 600 posting its worst monthly performance in over three years in May.
Weak economic numbers worldwide have pointed to slowing growth and the risk of recession ahead as a trade war between the United States and China escalates.
"As the US president is ratcheting up trade tensions, he is using tariffs to pursue non-economic goals which is worrisome and highlights the risk of a solution being very far away," said Hense.
There was a hint of the risks for the fund management community if a decade-long stocks rally is drawing to a close in the suspension by high-profile fund manager Neil Woodford of his Woodford Equity Income Fund.
Fund supermarket Hargreaves Lansdown, which includes the Woodford fund in six of its Multi-Manager investment packages, fell more than 5 per cent in response, making it the top faller on London's FTSE 100.
A 1.6 per cent jump in auto stocks helped Germany's DAX up 0.2 per cent and Italy's FTSE MIB rise 0.9 per cent after better-than-expected sales numbers from the US market on Monday.
Brokerage RBC also started coverage on Germany's Daimler and Volkswagen with "outperform" ratings, sending their shares up nearly 2.5 per cent each.
Italian banks rose 1.8 per cent, with traders citing conciliatory remarks from Italian Prime Minister Giuseppe Conte on respect of EU rules. The pan-European banking index was up 0.8 per cent.
The ECB holds its next policy meeting on Thursday and is expected to keep settings unchanged though there is growing speculation it could shift to a more dovish footing. Comments from the Federal Reserve on Monday raised expectations the US central bank is moving closer to a rate cut.