The FTSE 100 slipped Tuesday as a chip selloff rippled through European markets, overshadowing a flood of corporate earnings. Semiconductor stocks led declines after ASML warned of slower demand recovery, dragging down peers including Infineon and STMicroelectronics. The blue-chip index fell 0.8% in early trading, erasing Monday's modest gains.

Earnings season intensified with mixed results across sectors. BP rose after boosting its share buyback despite lower profit, while HSBC gained on stronger-than-expected revenue. Conversely, Diageo slumped on weak Latin America sales, and Burberry plunged after suspending its dividend amid a profit warning.

Investors digested UK wage data showing regular pay growth cooling to 5.7%, supporting bets on Bank of England rate cuts later this year. The pound held near $1.27 as traders weighed the earnings barrage against macroeconomic signals. Market focus now shifts to US inflation data due Wednesday for further directional cues.