European Markets Plunge on Inflation and Rising Bond Yields

European markets plummeted on Tuesday as inflation and rising bond yields took their toll. The Stoxx 600, a pan-European stock market index, dropped 0.6% to a one-month low of 647.08.

The declines were led by Germany's DAX, which fell 1.1%, and France's CAC 40, which slid 0.4%. Britain's FTSE 100 also eased 0.3% after resuming trading following Monday's public holiday.

The European Central Bank is expected to raise interest rates next week, with traders anticipating a 25-basis-point hike. This expectation was fueled by hawkish comments from Federal Reserve Chair Kevin Warsh and higher energy prices.