Published by Global Banking & Finance Review®
Posted on September 25, 2025
3 min readLast updated: January 21, 2026
Add as preferred source on GoogleEuropean shares fell to a three-week low as med-tech stocks were hit by US import probes. Investors are closely watching Federal Reserve signals and economic data.
By Shashwat Chauhan and Amir Orusov
(Reuters) -European stocks were dragged down by med-tech shares on Thursday after the U.S. launched fresh import probes, while investors sifted through comments from Federal Reserve officials and economic data for clues on the central bank's next move.
The pan-European STOXX 600 finished down 0.7%, having touched its lowest level in three weeks earlier in the session.
Most regional bourses also closed in the red.
Healthcare stocks were the worst sectoral performers, down 1.9%, with German medical technology company Siemens Healthineers sliding 3.4% after the U.S. Commerce Department said it has opened new national security investigations into the import of personal protective equipment, medical items, robotics, and industrial machinery.
Danish medical equipment maker Coloplast and Dutch med-tech company Philips also fell over 3% each.
Construction and materials was also among the top declining sub-sectors, down 1.5%, while industrial goods and services shed 0.8%.
Among gainers, Sweden's H&M jumped 9.8% after the fashion retailer reported a substantially bigger rise than expected in its third-quarter profit.
European miners advanced 0.6%, tracking surging copper prices with Shanghai copper hitting a six-month high.
Including Thursday's moves, the pan-European STOXX 600 was last up 9% so far for the year, trailing a near 13% gain in the U.S. S&P 500.
European equities kicked off 2025 on a strong note, buoyed by gains in defence stocks, but have since trailed behind Wall Street, where AI-driven optimism has propelled indexes to record highs this September.
While the Fed delivered its first rate cut of the year, the European Central Bank and Switzerland's central bank held rates steady. The Swiss National Bank also flagged concerns over U.S. tariffs, warning of a dimmer economic outlook heading into 2026.
Meanwhile, Chicago Fed President Austan Goolsbee voiced caution over easing policy too quickly, citing inflation risks.
His remarks highlight the fragility of the current rally and the market's sensitivity to central bank signals and economic data.
Markets pared back expectations for a 25-basis-point rate cut at the Fed's October meeting after initial jobless claims fell less than expected.
Claims for state unemployment benefits dropped by 14,000 to a seasonally adjusted 218,000 for the week ended Sept. 20, below the 235,000 forecast in a Reuters poll.
Investor focus now shifts to Friday's release of the Personal Consumption Expenditures (PCE) index — the Fed's preferred inflation gauge — which could shape expectations for the future path of interest rates.
"Post the most recent Fed moves, the market has coalesced around a central scenario of no recession and I think that view also holds in Europe," said Ben Lambert, European Equities portfolio manager at Ninety One.
Among other stock moves, Brunello Cucinelli plunged 17.2% after Morpheus Research took a short position in the company.
(Reporting by Shashwat Chauhan and Pranav Kashyap in Bengaluru and Amir Orusov in Gdansk; Editing by Rashmi Aich and Philippa Fletcher)
The Federal Reserve, often referred to as the Fed, is the central bank of the United States responsible for monetary policy, regulating banks, maintaining financial stability, and providing financial services.
Economic growth is the increase in the production of goods and services in an economy over a period of time, typically measured by the rise in Gross Domestic Product (GDP).
Investor sentiment is the overall attitude of investors toward a particular security or financial market, often influenced by market trends, news, and economic indicators.
A central bank is a financial institution that manages a country's currency, money supply, and interest rates, and oversees the banking system to ensure economic stability.
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