According to a report from the Wall Street Journal, European stocks deepened a string of recent losses Tuesday, falling across the board after strong U.S. economic data rekindled expectations that the U.S. Federal Reserve could begin to scale back its stimulus program as early as this month.
Also hurting sentiment, the European Union's statistics agency said October producer prices for the euro zone fell 0.5% on the month, and were down 1.4% on the year, the fastest annual rate of decline in almost four years. That sparked fears that deflationary pressures could threaten the fragile recovery in Europe.
The Stoxx Europe 600 index closed down 1.4%, marking its third straight day of losses. All major European benchmarks closed the day lower, with France leading the declines, after Credit Suisse cut its recommendation on French stocks to underweight relative to the rest of Europe. Paris's CAC 40 lost 2.7%, Germany's DAX shed 1.9%, while London's FTSE 100 was 1.0% lower.
The move replicates the declines on Wall Street,strong US economic data has heightened speculation about a December rollback in the Fed's $85 billion a month bond-buying program, which has been a major driver for global equity markets this year.
