FRANKFURT: European stocks were dragged down by med-tech shares on Thursday after the US launched fresh import probes, while investors sifted through comments from Federal Reserve officials and economic data for clues on the central bank’s next move.
The pan-European STOXX 600 finished down 0.7 percent, having touched its lowest level in three weeks earlier in the session.
Most regional bourses also closed in the red.
Healthcare stocks were the worst sectoral performers, down 1.9 percent, with German medical technology company Siemens Healthineers sliding 3.4 percent after the US Commerce Department said it has opened new national security investigations into the import of personal protective equipment, medical items, robotics, and industrial machinery.
Danish medical equipment maker Coloplast and Dutch med-tech company Philips also fell over 3 percent each.
Construction and materials was also among the top declining sub-sectors, down 1.5 percent, while industrial goods and services shed 0.8 percent.
Among gainers, Sweden’s H&M jumped 9.8 percent after the fashion retailer reported a substantially bigger rise than expected in its third-quarter profit.
European miners advanced 0.6 percent, tracking surging copper prices with Shanghai copper hitting a six-month high.
Including Thursday’s moves, the pan-European STOXX 600 was last up 9 percent so far for the year, trailing a near 13 percent gain in the US S&P 500.
European equities kicked off 2025 on a strong note, buoyed by gains in defence stocks, but have since trailed behind Wall Street, where AI-driven optimism has propelled indexes to record highs this September.
While the Fed delivered its first rate cut of the year, the European Central Bank and Switzerland’s central bank held rates steady. The Swiss National Bank also flagged concerns over US tariffs, warning of a dimmer economic outlook heading into 2026.
Meanwhile, Chicago Fed President Austan Goolsbee voiced caution over easing policy too quickly, citing inflation risks.
His remarks highlight the fragility of the current rally and the market’s sensitivity to central bank signals and economic data.
Markets pared back expectations for a 25-basis-point rate cut at the Fed’s October meeting after initial jobless claims fell less than expected.
Claims for state unemployment benefits dropped by 14,000 to a seasonally adjusted 218,000 for the week ended Sept. 20, below the 235,000 forecast in a Reuters poll.
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