European Markets Tumble Amid Global Economic Uncertainty

European shares dipped as investors anticipated key U.S. economic reports. The pan-European STOXX 600 closed 0.5% lower, as apprehensions about interest rates and overvalued tech stocks sparked sell-offs. The luxury sector was pressured by China-Japan tensions, affecting Burberry and LVMH stocks.

On Monday, European shares retreated as investors cautiously awaited vital U.S. economic data, predicted to offer insights into the health of the global economy. The pan-European STOXX 600 concluded the day with a 0.5% loss at 571.68 points.

Market watchers pointed to recent anxieties over potential interest rate hikes by the Federal Reserve and the valuation bubble surrounding technology stocks, which spurred a worldwide sell-off the previous week, marking the largest daily loss for European equities in over a month. Regional indexes, including Germany's DAX, also faced declines, dropping 1.2%.

Complicating matters, geopolitical tensions between China and Japan over Taiwan further strained the luxury sector, with Chinese-related stocks like UK's Burberry and France's LVMH seeing notable declines.

(With inputs from agencies.)