European Markets Face Turmoil Amid U.S. Shutdown Threat

European shares took a hit on Tuesday as major energy and healthcare stocks lost their footing. This downturn comes amid investor anxiety regarding a potential U.S. government shutdown that could impede the timely release of the crucial monthly jobs data.

The pan-European STOXX 600 index dropped 0.2% to 554.7 points by 0709 GMT. Despite this setback, the index is on track for its third consecutive monthly increase and a quarterly gain exceeding 2%. Key oil and gas stocks declined by 0.8%, reflecting the dip in oil prices, with prominent players like France's TotalEnergies and the UK's BP each falling over 1%.

Healthcare stocks witnessed a 0.3% downturn, notably with Denmark's Novo Nordisk and the UK's AstraZeneca each decreasing by around 1%. The looming U.S. government shutdown, as discussed by Vice President JD Vance following stalled budget negotiations, would delay crucial jobs data this week, impacting economic assessments. Meanwhile, the UK reported a 0.3% economic growth in Q2 and German retail sales surprisingly dropped in August, further influencing market trends. Fashion retailer ASOS saw an 11.4% decrease after warning about missing annual revenue expectations.

(With inputs from agencies.)