European shares weighed down by luxury stocks

The pan-European STOXX 600 index ended 0.7% lower at 608.51 points, with luxury shares leading sector declines with a 3.8% fall, their fourth straight day of losses

European shares dropped on Wednesday, weighed down by a decline ‌in luxury stocks.

The pan-European STOXX 600 index ended 0.7% lower at 608.51 points, with luxury shares leading sector declines with a 3.8% fall, their fourth straight day of losses.

Shares of LVMH, the owner of Louis ‌Vuitton and Tiffany, shed 7.9% after CEO Bernard Arnault said he was cautious about ​the year ahead.

Given the cautious commentary from the company and mixed macroeconomic data, the recovery in demand may be somewhat delayed, Morningstar’s senior equity analyst Jelena Sokolova said.

Gucci owner Kering shed 3%, Moncler declined 2.9% and Hermes slipped 3.7%.

Investors were also gearing up for quarterly updates from U.S. technology companies such as Meta and Microsoft later in the day. Their reports will be scrutinised for how the AI leaders are monetising the technology, at a time ⁠when elevated corporate spending has kept markets on edge.

Chip equipment maker ASML eased worries about a ‍near-term slowdown in demand after reporting stronger-than-expected fourth-quarter bookings. Broader caution around the sector, however, left the shares closing down ‌1.9% ‌after an initial jump to a record high.

While the stock’s valuation multiples are high even with the 2026 guidance, the order strength and positive industry news flow is likely to provide further medium-term upside, Jefferies analysts said.

On the data front, Germany lowered its growth forecasts for this year and next, citing heightened uncertainty around global trade and the slower‑than‑expected impact of economic and fiscal measures.

Focus is also on the U.S. central bank’s rate decision later in ‍the day. The central bank is widely expected to hold rates steady, with attention centred on risks to its independence.