British Pound advances against Euro as UK jobs data strengthens BoE hike bets

European equities continued their decline on Tuesday as persistent protests in France sapped confidence in the region. The unrest, which began over the weekend, has exacerbated concerns over economic stagnation and soaring government debt in a country set to hold presidential elections in six months. French authorities imposed curfews in multiple cities, including Paris, Lille, and Nice.

The pan-European STOXX 600 index fell 0.51% to 636.32 points, while the CAC 40 index in France slipped 0.41%. French government bond yields dipped slightly as investors remained cautious ahead of a budget vote later in the day. Analyst Neil Wilson noted that investors are finding it challenging to muster confidence in the current European environment, citing uncertainties around future policies, particularly in France.

Most major European sectors were trading lower, with technology and industrials leading the decline. Notable corporate earnings reports also weighed on sentiment, with OVHcloud surging 7.9% after reporting its first positive levered free cash flow since its 2021 listing, and Comet Holding rising 4.1% after a boost in third-quarter sales.

However, ABB and Schneider Electric both fell, with ABB slipping 5.3% despite announcing record quarterly orders, and Schneider Electric declining 2.1% following a significant share sale. European Central Bank policymaker Olli Rehn was set to speak later in the day, providing potential insights into the ECB's policy trajectory. Market participants are currently anticipating a hold on interest rates during the ECB's October meeting, with a high probability of a rate hike in December.