FX.co ★ European Stocks Trade Lower

European stocks experienced a downturn on Wednesday, marked by a 0.4% decline in the Stoxx 50 and a 0.3% decrease in the Stoxx 600, with the aerospace and defense sectors leading the descent. The Stoxx Europe Aerospace & Defense index further dropped by 0.9%, following a 2.6% dip on Tuesday, as positive sentiment surrounding a potential ceasefire in Ukraine weighed on the sector. German companies Rheinmetall and Hensoldt saw decreases of nearly 2% each, while UK counterparts Rolls-Royce and Qinetiq also reported losses of around 2%. This slump followed U.S. President Trump's urging for Putin and Zelenskiy to demonstrate "flexibility" and convene a bilateral summit, intensifying speculation of progress in peace negotiations. In other developments, the UK's inflation rate exceeded expectations, reaching 3.8% in July, while global markets took a breather after a recent surge to record highs. A significant selloff in major tech stocks has sparked concerns that the rally since April may have overextended. Consequently, investors are anticipating the Jackson Hole Symposium, as Federal Reserve Chair Jerome Powell is set to deliver remarks on Friday.