European stocks closed lower on Tuesday, extending the previous session’s losses amid renewed pressure on luxury-goods makers and banks. The Euro STOXX 50 slipped 0.4% to 6,236, while the STOXX Europe 600 declined 0.3% to 634.
Energy markets added to the headwinds. Oil prices climbed further as investors reduced expectations that Middle Eastern supply will return to the market in the near term, and European natural gas benchmarks remained at elevated levels. The resulting upside risks to inflation from higher energy costs continued to fuel expectations of additional ECB rate hikes this year, ahead of an anticipated interest rate increase by the Federal Reserve after tomorrow’s closing bell.
Rising bond yields weighed on the banking sector, with shares of UniCredit and Deutsche Bank both losing more than 2%. Luxury names also slid, as LVMH and Hermès fell nearly 2.5% after Chinese retail sales data came in weaker than expected.
