Stock markets dropped on Tuesday as downbeat surveys on business confidence and weak overnight earnings from social media group Snap intensified nerves about the global growth outlook.

Europe’s regional Stoxx 600 share index, which has lost more than a tenth so far this year as the economic impact of Russia’s invasion of Ukraine combined with the eurozone and UK central banks tightening monetary policy, fell 0.7 per cent in morning trading.

London’s FTSE 100 fell 0.2 per cent and Germany’s Xetra Dax lost 0.9 per cent, after all major Asian stock indices swung into the red earlier in the session.

German businesses were “hiking their charges for goods and services to offset the higher cost of energy, fuel, raw materials and personnel,” according to a report accompanying S&P Global’s May flash purchasing managers’ index for the dominant eurozone economy.

Japanese manufacturing activity was also expanding at its slowest pace in three months according to an equivalent PMI survey for the Asian nation, which its compilers blamed on “supply chain disruptions” from “economic sanctions placed on Russia” and “lockdown measures across China.

Investors’ nerves were further rattled by weak earnings from social media company Snap, which was down almost 30 per cent in US pre-market trading on Tuesday. The Snapchat parent, one of a group of social media businesses whose shares boomed during coronavirus lockdowns, said after the closing bell on Monday that “the macroeconomic environment has deteriorated further and faster than anticipated” since it issued guidance in April.

“The economic cycle is likely to be slowing down to a rapid extent,” said Zehrid Osmani, manager of Martin Currie’s global portfolio trust. Investors were poised for analysts to widely downgrade their earnings forecasts for large companies this year, he added, meaning “it unnerves the market when companies disappoint”.

Facebook owner Meta was down almost 7 per cent in pre-market trading. Twitter dropped 4 per cent and Pinterest fell 14 per cent. Futures contracts tracking the technology-heavy Nasdaq 100 share index dropped 1.7 per cent, while those tracking Wall Street’s S&P 500 — which bounced almost 2 per cent higher on Monday following seven consecutive weeks of losses — lost 1.1 per cent.

In another sign of the growth jitters, the yield on the 10-year US Treasury note, which moves inversely to the price of the benchmark debt security, fell 0.04 percentage points to 2.82 per cent as traders bought up the low-risk asset. Germany’s equivalent Bund yield dipped 0.01 percentage points to 1.01 per cent.

The euro, which had rallied on Monday, rose 0.2 per cent against the dollar to $1.07. Sterling slipped 0.6 per cent lower to $1.25. Brent crude, the worldwide oil benchmark, added 0.1 per cent to $113.47 a barrel.

In Asia, Hong Kong’s Hang Seng index closed 1.7 per cent lower and Tokyo’s Nikkei 225 dropped 0.9 per cent.