European stocks plunged, extending last week’s decline amid a deepening global rout in equities and a rotation away from the technology shares that have powered this year’s rally.

The Stoxx Europe 600 Index fell as much as 3.2%, the steepest intraday drop since March 2022. All sectors declined, with mining and energy shares sinking the most.

The benchmark sank 2.9% last week, its biggest weekly loss in more than nine months, as investors’ fears around a recession started to mount globally. France’s CAC Index has now fallen more than 10% from its recent peak, the technical definition of a correction.

“The weak ISM manufacturing index and a weaker-than-expected employment report have rekindled recession fears on the financial markets,” said Mathieu Racheter, Julius Baer head of equity strategy.

The batch of soft data is a temporary pause in the ongoing economic recovery and there’s a low risk of recession, he said. “The reset in earnings expectations following the disappointing reports sets the bar back to an achievable level for companies,” Racheter added.

In Asia, the MSCI Asia Pacific Index sank 6.4% and now is down 12% from its recent peak on July 11. In another sign of souring investor sentiment globally, Bitcoin has slumped about 10%.

Among single stocks, L’Oreal SA said it is buying a 10% stake in Swiss skincare company Galderma Group AG to benefit from its range of dermatological products. While L’Oreal fell with the rest of the market, Galderma rose 6.6%%.

  - Bloomberg