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flag European stocks dropped as U.S.-China trade tensions worsened and economic data weakened.

flag European stocks fell Tuesday as U.S.-China trade tensions escalated, with China rejecting negotiations amid new U.S. restrictions and retaliatory controls on critical minerals. flag Weak economic data from Germany and the U.K., including inflation rising to 2.4% in Germany and unemployment rising to 4.8% in the U.K., weighed on markets. flag The pan-European Stoxx 600 dropped 0.5%, with Germany’s DAX and France’s CAC 40 both down 0.8%. flag The euro weakened to near two-month lows against the dollar, below 1.1560, amid risk-off sentiment. flag Individual stocks varied: TomTom and Ericsson surged on strong earnings, while Bytes Technology fell on Microsoft policy changes. flag GSK, Bellway, and Publicis Groupe rose on positive news. flag Market focus turned to Fed Chair Powell’s upcoming speech and U.S. bank earnings.

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