Five Things You Need to Know to Start Your Day: Europe

Good morning. Global equities are tumbling as the US posts weak economic numbers and big tech’s woes mount. Central banks’ policy paths diverge. And ‘Trump trades’ are unwinding. Here’s what people are talking about.

Please note: Our email domain is changing, which means you'll be receiving this newsletter from noreply@news.bloomberg.com. Update your contacts to ensure you continue receiving it -- check out the bottom of this email for more details.

European equities will likely follow Asian and US markets lower as risk sentiment staggers from the triple blow of a Japan selloff, more lackluster technology earnings and weakness in the US economy. The MSCI Asia Pacific Index dropped as much as 3%, the most since June 2022, with Taiwan Semiconductor Manufacturing and Tokyo Electron among the biggest drags. Japan’s Topix Index headed for a technical correction, while benchmarks in the tech-heavy markets of South Korea and Taiwan also fell. Traders are taking risk off the table as the investment landscape shifts. Japanese stocks are falling out of favor as the prospect of further interest rate hikes by the country’s central bank supports the yen, hitting the shares of exporters. And disappointing earnings from US tech behemoths has cooled optimism over artificial intelligence. The regional declines also came after concerns over the health of the US economy emerged. Thursday data showed unemployment claims hit an almost one-year high while manufacturing shrank. Investors will be monitoring payrolls data due later Friday for further clues.