Europe: Shares slip with US inflation data in focus

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European shares dipped on Tuesday as investors cautiously waited for key US inflation data later in the week for hints on the Federal Reserve’s next move on interest rate increases.

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The pan-European Stoxx 600 index fell 0.6 per cent, erasing nearly all of its gains from its best session in nearly two weeks seen on Monday.

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Declines on Tuesday were led by rate-sensitive tech stocks amid an uptick in bond yields as traders raised bets

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a half-point interest rate hike by the European Central Bank in September, also pricing a high chance of a 75 basis point move in the United States next month.

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Banks were among the only outperformers, rising 0.1 per cent.

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Economically sensitive sectors such as miners and autos also fell after being among the top gainers in the previous session.

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The Stoxx 600 has floundered this month after climbing 7 per cent in July on worries over dour economic data,

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rising geopolitical tensions and fears that higher interest rates could tip the economy into a recession.