positive sentiment reverses, data, stocks at a glance

European stocks were down sharply on Wednesday as US Treasury yields soared as inflation fears continued to weigh on global markets.

The pan-European Stoxx 600 fell 1.5% at the start of trading, with travel and leisure stocks falling 2.4% to cause losses as all sectors and major stock markets slipped into negative territory.

The benchmark 10-year US Treasury yield rose above 1.56%, briefly hitting a three-and-a-half-month high as investors worried about the potential for a persistent rise in inflation. Rising bond yields have prompted investors to shy away from highly valued tech stocks, as higher rates make their future earnings less attractive.

Tuesday’s reversal of positive sentiment didn’t just apply to Europe. US equity futures fell early in pre-market trading and Asia-Pacific stocks were mostly down in Wednesday trading.

In terms of the development of individual stock prices in Europe, British grocery giant Tesco climbed 4.7% in early trading after improving its outlook after strong results in the first half.

At the bottom of the European blue chip index, Danish medical device company Ambu fell more than 9% after warning that revenue growth and profits would fall below previous forecasts.

Data released Wednesday in Europe included the latest German industrial orders and the most recent reading of Spanish industrial production.

Investors in the region could keep an eye on US data on Wednesday for further guidance on the country’s economic health with the ADP private wage report for September due to be released on Wednesday. The closely watched non-farm payroll report for September is expected to be released on Friday.

– CNBC’s Hannah Miao and Eustance Huang contributed to this market report.