Global Markets Teeter Amid Political Upheaval and Banking Uncertainty

European shares saw a decline as President Trump's suggestion to cap credit card interest rates impacted banks, stirring global markets. Geopolitical tensions, including issues in Venezuela and Iran, fueled uncertainty. Banks like Barclays faced declines, while investor morale in the eurozone showed unexpected improvement.

European shares retreated from record highs on Monday following U.S. President Donald Trump's proposal for a cap on credit card interest rates, which pressured the banking sector and heightened market tension. The friction between the Trump administration and the Federal Reserve Chair kept investors on edge.

The pan-European STOXX 600 index fell 0.2% at 1033 GMT, weighed down by a 0.4% drop in bank stocks, with UK lender Barclays plunging 3.2%. Trump's call for a 10% interest rate ceiling could disrupt the credit industry's financial dynamics.

Amid these challenges, safe-haven assets gained traction after Trump's threat to indict Fed Chair Jerome Powell. Despite the turmoil, Germany's DAX reached a new high. Meanwhile, investor sentiment in the eurozone unexpectedly improved, according to the Sentix index.

(With inputs from agencies.)