European stocks were hit Tuesday by negative news on China, raising concerns about the health of the world’s second-biggest economy and No. 2 market for EU exports.

Major indexes across Europe were down in late afternoon trading -- Britain's FTSE 100 by 1.17 percent; the German DAX, 1.33 percent; France’s CAC40, 1.29 percent; and the broad Stoxx Europe 600, 1.16 percent.

Similar declines were seen in U.S. stock indexes, following a losing day in Asia. China's Shanghai Composite shed 1.4 percent -- its first loss in three days -- and Australia's S&P/ASX 200 was off by 0.4 percent.

Lingering fears of slowing growth in China were heightened Monday when the country's policy-setting National Development and Reform Commission said it will raise retail prices of gasoline and diesel fuel for the second time this year due to the effect of rising crude-oil prices on refiners.

Growth slowdown concerns in China are the main catalyst for the global equity market weakness, Peter Boockvar, managing director at trading firm Miller Tabak, wrote Tuesday. He said moves to increase fuel prices indicate Chinese officials are mindful of recent declines in their country's consumer price index, but on the other it will have an obvious impact on spending.

Shares of raw materials and automotive companies, particularly sensitive to demand from China, were hit hardest.

Another bit of negative news was commodities giant BHP Billiton PLC's (LON: BLT) outlook on iron ore, which predicted flattening demand for the commodity from China.

Billiton was down 3.9 percent Tuesday, Germany's BMW AG (ETR: BMW) 4.6 percent and Luxembourg-based steel producer ArcelorMittal SA (EPA:MT) 3.2 percent.

Richard Batty, a strategist at investment firm Standard Life, told Reuters that European stocks were also weighed down by reports that foreign luxury-car brands have resorted to steep discounts to attract customers.

Mercedes-Benz, for example, is offering 25 percent price cuts on some models amid weakening demand, Bloomberg News reported.

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