European stock markets closed lower on Tuesday, dragged down by inflation concerns and a sell-off in technology shares, despite a strong rally in the energy sector. The Stoxx Europe 600 index ended the day down 0.4% in London, testing its 50-day moving average. Technology stocks came under pressure after OpenAI failed to meet targets for new user growth and revenue. The Stoxx Europe 600 Technology sector index fell 1.8%, making it the worst-performing sector. The decline was led by semiconductor and artificial intelligence-related stocks, including BE Semiconductor Industries NV, ASM International NV, and ASML. In contrast, BP Plc rose 1.1% following better-than-expected earnings, supported by strong trading operations and downstream business performance. Other energy stocks, such as Shell and TotalEnergies, also advanced as Brent crude prices climbed above $111 per barrel.
"Oil is more likely to act as an amplifier of volatility," said a research director at Energy Group Capital. "If high oil prices persist long enough to feed into inflation, profit margins, and policy expectations, their impact will return to the core of market concerns." In other corporate news, Barclays fell as much as 4.3% during the session. The decline came after the bank set aside additional provisions and reported impairments of around £200 million, overshadowing what analysts described as solid underlying performance. Ahead of policy meetings by the European Central Bank and the Bank of England this week, investors remained cautious, awaiting signals on the future direction of monetary policy.
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