European Stocks Slide as Tech Rout Resumes, Oil Price Tumbles

(Bloomberg) -- European equities wiped out much of Monday’s rebound as tech shares resumed their slump alongside U.S. peers, while energy stocks tracked a sharp drop in crude prices amid signs of faltering demand.

The Stoxx Europe 600 Index closed down 1.2% in London, with all but one of the sectors losing ground. Technology and cyclical industries including energy, banks and travel dominated the field of laggards, amid rising coronavirus cases in the region, U.S-China tensions and precarious Brexit negotiations.

Europe’s technology sector gauge fell 2.1% to a level not seen since July, signaling that the recent stumbles of global tech’s blistering 2020 rally may not be over. The Nasdaq 100 was down 2.8%, dogged by declines of as much as 20% at Tesla Inc. after the double setback of failing to accede to the S&P 500 Index and General Motors Co.’s decision to invest in rival Nikola Corp.

U.S. stocks are now at a crossroads, because the rise of the last few weeks could only have been a bear market rally, Fuerst Fugger Privatbank analyst Christian Curac commented by email, warning that “market participants have to position themselves more defensively from here.”

The FTSE 100 Index outperformed, down 0.1%, as its retreat was cushioned by a sharp drop in the pound, hurt by mounting worries of a no-deal Brexit. Shares in oil and gas groups tumbled, with Total SE closing down 3.7% and BP Plc down 3.1%. Crude in London tumbled below $40 a barrel for the first time since late June.

EasyJet Plc fell 4.9% after the latest U.K. curbs on international travel forced the discount carrier to slow the build-up of its summer flight schedule. Electricite de France SA was also among Europe’s worst performers on Tuesday, declining 8% after announcing it would sell up to 2.4 billion euros ($2.8 billion) of convertible bonds.

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