European equities retreated on Tuesday, with the STOXX 50 down 0.3% and the broader STOXX 600 slipping 0.2%, following gains in the previous session. Defense stocks came under pressure as investors weighed developments in Russia–Ukraine peace negotiations. US President Trump said on Monday that, after “long and very good talks” with European leaders, negotiators were “closer now than we have ever been” to ending the conflict. Major defense names declined, including Rheinmetall (-3.5%), BAE Systems (-2.3%), Leonardo (-4.1%) and Thales (-2.3%). Technology heavyweights also weighed on the market, with ASML Holding falling 1.7% and SAP down 1.2%. In contrast, LVMH outperformed, with shares rising 1.3%. Meanwhile, flash PMI data for the Euro Area continued to signal a mixed outlook, as private-sector activity disappointed in Germany, while France’s services sector slowed far more than expected.
