European Markets Tumble as U.S. Job Data Sparks Global Selloff

European shares reached a one-week low, driven by market selloffs after U.S. job data heightened caution over Federal Reserve rate cuts. Sensitive sectors like technology and real estate saw declines, while energy rose amid sanctions on Russian oil. Inflation data and U.S. policies remain pivotal.

European shares dropped to a one-week low on Monday as global equity markets faced a broader selloff following stronger-than-expected U.S. job data. This fueled expectations that the Federal Reserve will adopt a cautious approach to interest rate cuts this year.

The pan-European STOXX 600 index shed 0.5% to close at 508.71 points, marking its lowest since January 6 after nearly a 1% decline on Friday. The downturn was precipitated by unexpected U.S. job growth acceleration in December and a decline in the unemployment rate to 4.1%.

Technology and real estate sectors, which are sensitive to interest rate changes, mirrored Wall Street's declines, falling by 1.2% and 1.3% respectively. However, energy stocks bucked the trend, climbing 1.1% as crude oil prices surged due to expanded U.S. sanctions on Russian oil.

(With inputs from agencies.)