European stocks tumbled more than 1% on Wednesday as a surge in oil prices intensified concerns over higher inflation, while investors moved out of high-growth tech stocks into banking shares.

After a late-session rally on Tuesday, the pan-European STOXX 600 index fell 1.2%, with the tech sector down more than 2%.

Banks slipped 0.1%, but were the smallest decliners on prospects of higher interest rates, as bond yields climbed and oil prices hit multi-year highs.

Tech sell-off drags European stocks lower

UK's HSBC and Germany's Commerzbank were up more than 1% each.

Deutsche Telekom fell 4.1% after Goldman Sachs sold shares worth 1.58 billion euros ($1.83 billion) in a SoftBank structured finance deal.

Bayer AG rose 0.7% after the German agricultural and pharmaceuticals firm won its first trial over claims its Roundup weedkiller causes cancer.

Tesco jumped 4.5% as Britain's biggest retailer raised its full-year outlook and launched a 500-million-pound share buyback programme.