European equities steadied as pressure from a tech-led selloff eased, with investors shifting attention to upcoming central bank signals and policy events.
Tech jitters cool as Europe holds flat
The pan-European STOXX 600 was nearly flat after falling as much as 0.4% earlier, weighed by weakness in technology and defence stocks. The move followed declines across Asian markets, where tech-heavy indexes led losses after the NASDAQ composite dropped nearly 1.5% on Tuesday. NASDAQ futures were just 0.2% lower on Wednesday, pointing to a calmer start.
While no single catalyst drove the tech retreat, analysts cited a mix of high valuations, a risk-off tone, and U.S. political dynamics. “I think we were priced for perfection in the U.S. and there was a quite a lot of complacency in markets, so some summer volatility should have been expected,” said Ben Laidler, head of equity strategy at BRADESCO BBI.
According to Reuters via Yahoo Finance, investor focus also encompassed U.S. policy moves affecting the sector. U.S. Commerce Secretary Howard Lutnick is examining potential equity stakes in Intel and other chipmakers, two sources told Reuters. The report added that Washington has recently struck unusual deals with companies, including allowing Nvidia to sell H20 chips to China in exchange for the U.S. government receiving 15% of those sales’ revenue.
Rates, currencies, and commodities in focus
Central banks set the tone ahead of Jackson Hole
Attention turned to the Kansas City Fed’s Jackson Hole symposium from August 21–23, where Chair Jerome Powell is due to discuss the economic outlook and policy framework on Friday. Traders are almost fully pricing a rate cut next month. Minutes from the Fed’s July meeting were due later Wednesday, though they pre-date recent soft U.S. labor data.
In Europe and the Asia-Pacific, Sweden’s central bank held rates as expected, while the Reserve Bank of New Zealand cut policy rates to a three-year low and signalled further easing, sending the New Zealand dollar down more than 1%.
In commodities, Brent crude rose 1.1% to $66.55 a barrel as markets watched developments in efforts to end Russia’s war in Ukraine. A meeting between U.S. President Donald Trump, Ukrainian President Volodymyr Zelenskiy, and European allies ended without major announcements, though Trump said the United States would help guarantee Ukraine’s security in any agreement.
Currency and bond moves were muted. The dollar was steady against the euro at $1.1646, while sterling was flat at $1.3498 after UK inflation hit an 18-month high in July. Ten-year gilt yields fell 5 bps to 4.69%, and the U.S. 10-year Treasury yield edged to 4.29%. Spot gold rose 0.3% to $3,326.89 an ounce.
