* Stock markets tumble as tech stocks sell off
* Inflation angst lingers across assets
* Commodities take breather after rapid rise
* Global asset performance http://tmsnrt.rs/2yaDPgn
* World FX rates http://tmsnrt.rs/2egbfVh (Adds European open)
By Marc Jones
LONDON, May 11 (Reuters) - Global stock markets were set for a second day of sharp losses on Tuesday as the combination of inflation worries and an anti-monopoly drive in China sent the world's mightiest tech giants tumbling.
Europe had touched a record high on Monday but its restart was a sea of red as London's FTSE .FTSE , Frankfurt's DAX .GDAXI and the CAC 40 in Paris .FCHE all dropped roughly 2%. .EU
Asia's main regional equity gauges .MIAPJ0000PUS had suffered their biggest slide in nearly two months overnight, with Japan's Nikkei .N225 and Hong Kong's Hang Seng .HSI both closing down 3%. talk of tighter regulation from Beijing, Chinese tech heavyweights Baidu (NASDAQ:BIDU) 9888.HK , Alibaba (NYSE:BABA) 9988.HK Tencent 0700.HK , collectively dubbed the BATs, all dropped more than 3%. Food delivery major Meituan 3690.HK tumbled as much as 9.8% too, leaving its value $30 billion lower in a week.
It had followed a 3.6% slump in the U.S. FANG+ index of megacap tech firms .NYFANG on Monday. Electric car pioneer Tesla TSLA.O had skidded 6.4% and Google GOOGL.O fell 2.5%. .N
"The underlying driver is that there is still a rotation out of duration (higher interest rate) sensitive parts of the market and this is why tech stocks are coming under pressure now," said Mizuho's Head of multi-asset strategy Peter Chatwell.
"Given the rise in the earnings power of these firms different governments will also seek to raise more tax revenue from them in the coming years."
INFLATION ANGST
The cost of raw materials from copper to wood to wheat have been soaring over the last month, testing the views of top central bankers that rises in inflation will be transitory as economies emerge from COVID lockdowns.
U.S. breakeven rates, which factor in inflation, have scaled multi-year peaks. Most euro zone bond yields edged back up on Tuesday while a market gauge of long-term inflation expectations EUIL5YF5Y=R was nearing its highest in over two years.
A host of Federal Reserve and European Central bank speakers this week will be closely watched by markets to assess how authorities are likely to respond.
A test case on U.S. inflation will come when the Labor Department releases consumer price index report on Wednesday.
"Inflation's shadow looms large and we do think that there is a limit to the Fed's tolerance of inflation," DBS Bank said in a note.
In currency markets speculation that growing price pressure would erode the dollar's value kept the U.S. currency near a 2-1/2-month low.
A consolidation in commodity markets after their surge on Monday kept the Australian dollar AUD=D3 just below a two-month high at $0.7827. The Canadian dollar CAD=D3 stabilised near a four-year high, while the New Zealand dollar NZD=D3 perched comfortably at February highs.
Oil prices gave up earlier gains as concerns that rising COVID-19 cases in Asia will dampen demand outweighed expectations that a major U.S. fuel pipeline could restart swiftly. crude CLc1 dipped 0.66% to $64.49 a barrel. Brent crude LCOc1 fell to $67.84 per barrel.
Metal markets saw copper prices start to nudge higher again. They were last at $10,470 a tonne having hit a record high $10,747.50 the previous session. Iron ore SZZFc1 had settled too after surging 7% on Monday.