European Markets Reel from Novo Nordisk's Plunge Amid Trade Tensions

European stock markets faced setbacks as Novo Nordisk's shares fell sharply following competition news from rival Eli Lilly. U.S. President Trump's criticism of Federal Reserve Chair Powell added further pressure amidst ongoing trade war concerns. Despite this, capital shifts favored Europe over U.S. equities.

European shares experienced a downturn on Tuesday, primarily impacted by the steep decline of heavyweight Novo Nordisk after rival Eli Lilly's trial results showed promising competition for its drug Ozempic. The pan-European STOXX 600 index registered a 0.6% drop amid mixed performances across regional indexes.

Adding to market volatility, U.S. President Donald Trump's renewed critique of Federal Reserve Chair Jerome Powell contributed to an already tense global trading environment. While European stock losses were relatively modest compared to U.S. counterparts, uncertainty over Trump's tariff policies continues to loom large over corporate earnings forecasts.

Despite the subdued outlook, some sectors showed significant gains, such as Biotage's 56.2% rise following a buyout offer, and Swiss insurers Helvetia and Baloise reported robust stock performance due to merger plans. Attention now turns to upcoming euro zone consumer confidence and PMI data releases for further market direction.

(With inputs from agencies.)