European Shares Slide as Fed Policy Looms: Financials Hit Hard

European shares recorded significant losses on Tuesday, as investor caution prevailed ahead of the U.S. Federal Reserve's anticipated interest rate decision. The STOXX 600 index fell by 1.15% to a one-week low, with financials, banks, and insurance among the hardest hit, reflecting a broad downturn across the market.

Germany's DAX, France's CAC 40, and the UK's FTSE 100 also sustained declines, amid expectations of a 25-basis-point interest rate cut from the Fed. This comes after indicators of a weakening U.S. job market and ongoing concerns over potential political influences on the Fed's autonomy.

While the financial sector struggled, basic resources saw minor gains due to rising copper prices. In contrast, hiring firms and some luxury brands faced declines, highlighting a mixed market sentiment ahead of Wednesday's critical policy announcement by the Federal Reserve.

(With inputs from agencies.)