The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, November 11, 2025. REUTERS/staff

By Anastasiia Kozlova and Johann M Cherian

(Reuters) -European shares hovered near a more than one-month low on Wednesday, as tech valuation concerns kept investors cautious ahead of a high-stakes earnings report from AI poster-child Nvidia.

The pan-European STOXX 600 fell 0.2% to 560.65 by 0910 GMT and was close to levels last seen on October 1 that it touched in the previous session.

The index fell 1.7% on Tuesday, its biggest one-day drop in more than three months, on worries that the global tech rally, seen for much of the year, had turned into a potential bubble.

European tech stocks declined 0.4% on Wednesday, ahead of Nvidia's report that could either stoke or soothe investor worries about lofty valuations.

AI equipment maker Schneider Electric traded marginally lower, while Siemens Energy rose 1.7% after Tuesday's losses.

"It's a cocktail of everything weighing heavily right now from anxiety over when AI will start bringing revenue inside the circle from outside, to fading hopes that the Federal Reserve might cut interest rates in December," said Ipek Ozkardeskaya, a senior market analyst at Swissquote Bank.

"Obviously, if there is any disappointment (from Nvidia), it would be the latest nail in the coffin for the AI mood."

Banking stocks, which have been the biggest annual gainers this year, fell about 0.6% and were the biggest drags on the STOXX.

Investors are also awaiting the U.S. labour market report, due on Thursday, at a time when Fed policymakers are divided on the central bank's monetary policy verdict next month.

In the UK, inflation fell to 3.6% in October from 3.8% in September, its first drop since May and in line with forecasts, cementing expectations that the Bank of England could cut interest rates in December.

Among individual stocks, Kering <PRTP.PA> lost 3.2% after the luxury company's Chief Executive Luca de Meo said a return to growth will require reducing its reliance on struggling flagship Gucci, further scaling back its store network and chasing more synergies, according to a memo seen by Reuters.

Germany's Fraport fell 3.3% after UBS downgraded the stock to "sell", while Danish cable solutions provider NKT <NKT.CO> jumped 13% after reporting quarterly results and 2030 forecasts.

Travel retailer WH Smith <SMWH.L> fell 1.1% after CEO Carl Cowling announced his departure following the findings of an independent review into the company’s North American accounting practices.

(Reporting by Anastasiia Kozlova and Johann M Cherian; Editing by Eileen Soreng and Sonia Cheema)