European stock markets are falling under pressure from the banking and energy sectors

European stocks fell on Tuesday under pressure from the banking and energy sectors as strong data on US services sector activity raised fears that the Federal Reserve (the US central bank) will continue to hike interest rates on a large scale.

The Stoxx 600 index fell 0.1%, extending losses for the third consecutive session.

The index posted seven consecutive weeks of gains in hopes that signs of easing inflation will allow the US central bank to slow its rapid rate hike.

However, a report on Monday showed an unexpected rebound in US service sector activity in November, coupled with strong jobs data last week, providing new evidence of economic resilience and weighing on sentiment.

The energy index fell by 0.7%, while the banking index fell by 0.6%. However, rising shares in consumer staples companies, such as Nestle and Unilever, limited losses.

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