Europe midday: Tech stocks lead losses

Stocks are near their worst levels of the session as European tech shares play catch up with losses in their US peers last Friday, despite positive developments on the political front in France and Italy at the weekend.

As of 1202 BST, the benchmark Stoxx 600 was down by 0.84% or 3.26 points to 387.13, alongside a fall of 0.87% in Germany's Dax to 12,703.47 while the Cac-40 was slipping 1.02% to 5,245.11.

Losses were heaviest in the technology space, with the Stoxx 600 sector gauge plummeting 3.28% to 423.32; on 9 June America's tech-heavy Nasdaq-100 experienced its biggest one-day loss since September, with futures on Monday morning pointing to roughly another 1% drop on Monday.

On a related note, come Monday strategists at JP Morgan recommended clients remain 'defensive', arguing that global activity momentum had stalled and that almost all reflation signals were reversing.

That caution more than offset optimism regarding the outlook for the euro area's economy following a strong showing for the new French president's party and his allies and a potential setback for the populist 5SM movement in Italy.

In Sunday's first round of voting in France's legislative elections, newly arrived centrist president Emmanuele Macron's En Marche! party made off with 32.3% of the vote in the first round of the parliamentary elections together with its MoDem.

That put Macron's group on track to garner between 415 and 455 seats out of the 577 in the lower house of parliament, with analysts sanguine that Macron now enjoyed the political capital necessary to implement his reform agenda.

Also at the weekend, none of the candidates put forth by the 5SM movement in Italy's first round of local elections made it into the runoff votes in any of the main contested cities. That, analysts at Barclays Research said, appeared to show that 5SM's popularity may have peaked.

The news sent the yield on the benchmark 10-year Italian government note down by six basis points to 2.02%.

Italian industrial production fell by 0.4% month-on-month in April and was ahead by just 1.0% year-on-year, missing forecasts for an increase of 0.2% on the month and 2.5% over the year.

Confidence among French manufacturing sector firms was steady in May, according to the Banque de France's monthly sentime gauge which was steady at 105.0, as expected.

In remarks at the weekend, Unicredit chief said he expected a solution to be found for the country-s two ailing Veneto lender with the aid of other domestic banks.

Shares in Spanish small-cap lender Liberbank shot higher, recouping a large of the previous week's losses, after the country's market regulator instituted a ban on short-selling in the lender's shares.

Investors in Lufthansa were waiting on the airline's latest traffic figures for the month of May which were scheduled for release at 1000 BST.