Stocks fall across Europe and Nasdaq futures tumble 1%, as inflation concerns and selloff sentiment spread

Dow industrials futures YM00, -0.54% were pointing down around 170 points, set for a weak open after the index fell 35 points on Monday to close at 34,742.

Every constituent of the three major stock market indexes in London, Paris, and Frankfurt was in the red in early trading. Stocks in Europe, as well as Asia, followed Wall Street’s move lower on Monday, led down by the tech-heavy Nasdaq COMP, -2.55% which tumbled 2.55%.

“Once again it has been concern about inflation that appears to be weighing on broader market sentiment, with commodity prices once again the major culprit, ahead of U.S. CPI numbers that are due out later this week,” said Michael Hewson, an analyst at CMC Markets.

Also read: The biggest ‘inflation scare’ in 40 years is coming — what stock-market investors need to know

Investors will be closely watching the headline U.S. inflation figure — the Consumer Price Index, or CPI — when it is released on Wednesday. Hewson expects to see “a big rise” in this key measure.

“It seems that investors are now fretting about rising prices and sharply higher inflation again,” Hewson said. “The big question is whether they are right to be, and while we’ve seen sharply higher prices in the latest ISM [Institute for Supply Management] surveys and commodity prices are also on a tear, the bigger concern is whether they are likely to be temporary, or much more persistent. In the short term, it is probably too early to know.”

There was a particular weakness in companies exposed to commodity prices — especially miners and major oil companies — as well as tech groups and travel stocks in Europe.

The London-listed miners Rio Tinto RIO, -2.28%, Glencore GLEN, -1.16%, Anglo American AAL, -1.50%, BHP BHP, -1.79%, Fresnillo FRES, -0.07%, Antofagasta ANTO, -0.42%, and Polymetal International POLY, -0.81% were all lower, alongside European-listed oil groups BP BP, -2.06%, Royal Dutch Shell RDSA, -2.46%, Total TOT, -1.32%, and Eni ENI, -1.38%. Shares in the world’s largest steel producer, Luxembourgish ArcelorMittal MT, -3.11%, were the biggest faller on Paris’ CAC 40.

Plus: Energizer CEO expects inflation to keep going and going, disputing what most at the Fed believe

Tech companies were also battered, including Dutch semiconductor group ASML ASML, -2.70%, German software giant SAP SAP, -2.75%, Finnish telecom Nokia NOKIA, -2.91%, and British high-tech grocer and robotics logistics specialist Ocado OCDO, -3.09%.

In travel stocks, airlines International Airlines Group IAG, -4.79% — which owns British Airways — Air France-KLM AF, -2.05%, Lufthansa LHA, -2.95%, easyJet EZJ, -2.29%, Ryanair RYA, -2.66%, and Wizz Air WIZZ, -4.05% took a nosedive, as did hotel giants InterContinental Hotels Group IHG, -3.59% and Accor AC, -3.17%.

But British e-commerce player The Hut Group THG, +13.09% was a standout, with the stock up more than 11%, after a $1.6 billion deal with Japanese technology investment giant SoftBank.

Shares in battery manufacturer Invinity Energy Systems IES, +6.50% also rose 30%, after striking a deal with Siemens Gamesa 0H4N, -1.57% Renewable Energy to develop grid-scale vanadium flow batteries.