AI Spending Fears Spread Sell-Off Across European Markets
European shares fell sharply Friday after technology losses in the United States and Asia, amid concerns about AI investment and data-center plans.
Key takeaways
- The STOXX 600 fell 1.6% in early Friday trading, erasing its weekly gains.
- The index had closed 0.38% lower on Thursday as technology stocks dropped 3.2%.
- The Nasdaq fell 5.52% on Thursday, while Japan’s Nikkei 225 slid 5.5% in early Friday trade.
European shares fell sharply in early trading Friday, with the STOXX 600 down 1.6% and giving up its gains for the week. The decline followed technology-led losses in the United States and Asia.
The index had closed 0.38% lower on Thursday, at 654.87 points. Technology shares fell 3.2% to their lowest level in nearly two months, while weakness in defence stocks added to the losses.
Investor concerns include whether increased scrutiny of data-center construction could slow spending on artificial intelligence. The US midterm results, which gave Democrats control of both chambers of Congress, added to those worries. Some Democratic governors-elect campaigned on slowing AI development and stopping or pausing data-center construction.
US technology stocks tumbled on Thursday: the Nasdaq fell 5.52%, while the S&P 500 dropped 4.4%. In early Friday trading, Japan’s Nikkei 225 fell 5.5% and South Korea’s Kospi slid as much as 8.8%, triggering a 20-minute trading suspension.
Chipmakers were among Europe’s biggest decliners on Thursday. Soitec fell 16.7%, Infineon lost 8.5%, and ASML dropped 6.6%. Analysts cited by The Business Times said existing data-center orders were unlikely to be affected by the concerns.
This article was produced with the help of AI technology. Based on reporting by the outlets listed above.
