European Markets Retreat Amid AI Caution and Hawkish Fed Outlook

European equity markets faced downward pressure today as investors processed a combination of cautious sentiment surrounding artificial intelligence safety and persistent uncertainty regarding Federal Reserve interest rate policy. The cooling momentum in the AI sector, fueled by recent calls for development pauses, has prompted a more defensive posture among traders. Simultaneously, ongoing speculation about the timing and frequency of potential U.S. rate cuts continues to weigh heavily on market confidence, leaving major European indices struggling to maintain recent gains.