European markets closed lower on Tuesday, with the regional Stoxx 600 index slipping 0.54%.

The U.K.’s FTSE 100 dropped 1.36%, while France’s CAC 40 and Germany’s DAX were down by 0.72% and 0.17%, respectively.

— Jenni Reid

The U.K. subsidiary of fast fashion giant Shein reported £1.55 billion ($2.027 billion) revenue and £18.7 million profit for the year ending Dec. 31 2023, according to accounts made public Tuesday.

That compared with £9.8 million profit on £1.121 billion revenue over the 16 months to Dec. 31 2022 recorded in a previous filing.

Shein Distribution UK Limited said its business in 2023 had £29 million in net assets and 33 employees, primarily providing “marketing expertise” targeted to the U.K.

The Chinese-founded company has grown rapidly in markets including the U.S., Germany and the U.K. selling ultra-cheap clothing and accessories, attracting criticism over its labor practices and becoming embroiled in several copyright disputes in the process.

It confidentially filed for a London initial public offering in June and is currently seeking regulatory approval in the U.K.

The U.K.’s long-term borrowing costs have risen amid uncertainty around the Labour government’s upcoming Oct. 30 budget.

The yield on 10-year bonds — known as gilts — hit 4.2% on Tuesday, its highest level in nearly three months and its highest spread against the German bund in more than a year.

Investors are anxious about the contents of the budget after Finance Minister Rachel Reeves warned of tax rises and spending cuts. Meanwhile, expectations around the Bank of England’s forthcoming path for interest rates remain divided.

— Karen Gilchrist

Britsh housebuilder Vistry Group was trading 24% lower at 3:54 p.m. in London, falling to its lowest level since January after warning on full-year profit.

In a Tuesday morning trading update, the company said it now expected adjusted profit before tax to come in around £350 million ($458 million) for 2024, down from £419.1 million last year. In half-year results published last month, Vistry had forecast “full year profits ahead of last year.”

The firm, formerly Bovis Homes Group, said the change was due to one of its divisions understating total build costs for several developments by around 10%. This is expected to dent adjusted pre-tax profit by £80 million in full-year 2024, by £30 million in full-year 2025 and £5 million in full-year 2026, it added.

— Jenni Reid

Steve Ponting, director for U.K., Ireland & South Africa at Software AG, says discretionary consumer spending is on the rise, even as economic uncertainty remains.

“We’re seeing this trend of little sweet treats … just to treat themselves to give them a little boost. But they’re staying away from those big spends,” Ponting told CNBC’s “Squawk Box Europe.”

It comes after fresh data released Tuesday by the British Retail Consortium (BRC) showed retail sales rose 2% year-on-year last month, rising above the three-month average.

— Karen Gilchrist

Correction: Steve Ponting is director for U.K., Ireland and South Africa at Software AG. An earlier version misstated his name.

Telecoms and utilities stocks led a shift into the green for certain sectors, as souring sentiment around China’s stimulus plans eased.

Telecoms were up 0.46%, and utilities were 0.18% higher by 12:40 p.m. London time, while travel and leisure stocks ticked 0.1% higher.

— Karen Gilchrist

European drinks makers LVMH, Pernod Ricard and Diageo slumped lower Tuesday after China announced fresh tariffs on European brandy imports, days after the EU’s vote on EV tariffs.

LVMH and Pernod Ricard were both down more than 3% and Diageo was around 2% lower as the brandy producers winced at new tariffs which will make their products cost more in the key Chinese market.

The tit-for-tat measures follow the EU’s Friday vote for tariffs on Chinese-made electric vehicles (EVs) amid concerns Chinese subsidies are undercutting European carmakers.

It comes amid a wider slump in European stocks, and particularly the luxury sector, after optimism cooled around a Chinese stimulus package announced last week.

— Karen Gilchrist

European miners tumbled 4.6% on Tuesday morning, as the China stimulus rally continued to lose steam, leaving the sector on course for its worst daily loss since March 2023, when stocks plunged over 5.6%.

Shares of Anglo American, Antofagasta and Rio Tinto were all more than 5% lower by 9:50 a.m. London time.

— Karen Gilchrist

U.K. Finance Minister Rachel Reeves is on “tight guard rails” with her upcoming Autumn budget and is unlikely to roll out any unfunded plans, Neil Shah, director of research at Edison Group, told CNBC Tuesday.

“Given her position of restraining spending … she’s on pretty tight guard rails. In the event, I think we’re going to get [the Budget] out of the way and then get a focus back on the fundamentals,” he told “Squawk Box Europe.”

— Karen Gilchrist

France’s CAC 40 and the U.K.’s FTSE 100 both shed around 1% in morning deals as China’s stimulus rally faded following the reopening of markets in mainland China.

Germany’s DAX and Italy’s FTSE MIB were also both down more than 0.5% on waning hopes for China’s economic resurgence after a briefing from the country’s National Development and Reform Commission provided few further details on the plans.

U.K. housebuilder Vistry slumped to the bottom of the Stoxx 600 after saying its full-year profits will be nearly one-fifth lower than expected due to unexpected building costs within some of its projects.

The added costs stem primarily from projects in its southern division and led the firm to reduce its expectations for 2024 adjusted pre-tax profit by £80 million, with added costs expected over the next two years. It now expects adjusted pre-tax profit to be around £350 million for the year.

The firm’s shares were last trading 28% lower as of 8:52 a.m. London time.

— Karen Gilchrist

Shares of LVMH and Kering fell at the market open as luxury stocks pulled back from a China stimulus rally.

LVMH was down 3.84% and Kering was 5.05% lower by 8:15 a.m. as markets in mainland China reopened following the mid-Autumn Festival and turned sour on a stimulus package announced last week.

Luxury companies, hard hit by a slump in Chinese consumer spending, had hoped to benefit from China’s economic recovery. Burberry also shed 5.9% while Christian Dior was down 3.8%.

European markets opened lower Tuesday as regional sentiment sours further after a shaky start to the week.

The pan-European Stoxx 600 was down 0.81% in early deals, with all sectors and major bourses trading in the red. Mining stocks shed 3.65% while household goods fell 2.1%.

U.K. discretionary spending shot up in September, with consumers forking out on Oasis tickets and other non-essentials, even as the upcoming government Budget weighs on consumer confidence.

Retail sales rose 2% year-on-year last month, rising above the three-month average, as shoppers hit the high street to update their wardrobes, fresh data released Tuesday by the British Retail Consortium (BRC) showed.

“Retail sales saw the strongest growth in six months as non-food performed better than expected. As autumn rolled out across the UK, shoppers sought to update their wardrobes with coats, boots and knitwear,” BRC CEO Helen Dickson said.

It coincides with the release of Barclays’ consumer card report, which showed the fastest growth in non-essential spending this year, with a 2.7% year-on-year increase in September. It attributed it to a 36% annual jump in spending on concerts and shows, including the Oasis brothers’ forthcoming 2025 tour.

— Karen Gilchrist

October is traditionally a volatile month, but Piper Sandler believes that investors can use the market’s actions to their advantage.

“Historically, October tends to be a ‘backing and filling’ month as investors react to the Q3 earnings season results. We would continue to use ‘healthy’ pullbacks to add to positions, especially among leading SMID-caps in the Industrial, Financial, and Technology sectors,” the investment firm wrote in a Monday note.

In the note, Piper Sandler stood by its year-end S&P 500 target of 5,800. This implies that the broad market index could rise less than 1%.

— Lisa Kailai Han

Stock futures were slightly up shortly after 6 p.m. ET.

Dow and S&P 500 futures rose around 0.1% each. Nasdaq 100 futures added 0.2%.

— Alex Harring

European markets are expected to open lower Wednesday.

The U.K.’s FTSE 100 index is expected to open 6 points lower at 8,249, Germany’s DAX down 35 points at 19,482, France’s CAC down 59 points at 7,469 and Italy’s FTSE MIB down 137 points at 34,246, according to data from IG.

U.K. and Italian inflation data is released today.

Correction: This post has been updated to reflect the timing of ASML’s earnings release.

— Holly Ellyatt