European Shares Decline Amid French Uncertainty

(RTTNews) - European shares traded lower on Tuesday, with Fed independence fears and French political risks keeping investors on edge.

U.S. President Donald Trump took the unprecedented action of removing Federal Reserve Governor Lisa Cook, raising concerns over the Federal Reserve's independence.

French bonds tumbled as Prime Minister Francois Bayrou called a confidence vote for Sept. 8 over his plans for sweeping budget cuts.

Officials from France's main opposition parties said they would not back the government, raising the risk of French political instability.

In economic releases, U.K. shop price inflation accelerated to the highest since early last year in August due to higher food prices, the British Retail Consortium reported.

Shop price inflation rose to 0.9 percent in August from 0.7 percent in July. This was the highest since March last year.

The increase was driven by the annual rise in food inflation to 4.2 percent from 4.0 percent in July.

The pan European STOXX 600 fell 0.8 percent to 554.54 after declining 0.4 percent on Monday.

The German DAX dipped half a percent, France's CAC 40 fell over 2 percent and the U.K.'s FTSE 100 was down half a percent.

Bunzl jumped 5.5 percent as the British distribution firm announced the completion of two new acquisitions in Spain and Mexico.

Halma gained 1 percent after it acquired Netherlands-based advanced gyroscopic locating systems provider Brownline in a deal worth around £129m.

British American Tobacco declined 1.4 percent as Chief Financial Officer Soraya Benchikh stepped down with immediate effect after about 15 months in the role.

Swiss healthcare giant Novartis was moving higher after collaborating with Swedish biopharmaceutical company BioArctic to develop new treatments for serious neurological diseases.