Stocks in Europe and across global markets are weakening as investors sell mainly technology shares. Sentiment has been hit by expectations of an early increase in US interest rates, as well as concerns over rising corporate spending on artificial intelligence.
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Technology Sector Weighs on European Markets
The pan-European STOXX Europe 600 index, which tracks trading on exchanges in the UK and selected European Union countries, was down 0.8% shortly after midday, trading below 634.50 points. Losses were even deeper in the morning, exceeding one percent, pushing the index to its lowest level in more than a week. Germany’s DAX was down 1.2%, while London’s FTSE 100 lost 0.25%.
The technology sector was down 3.4% around midday and was heading for its largest one-day decline since February. Investors worldwide are reassessing the valuations of companies whose shares had risen sharply in recent months thanks to enthusiasm around artificial intelligence. Companies funding their investments through debt, such as Infineon and STMicroelectronics, may come under particular pressure.
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Chip Stocks Fell in Asia, While SpaceX Euphoria Fades in the US
In Asia, losses were especially sharp in South Korea, where the main KOSPI index fell 9.99% to 8,203.84 points. Foreign investors sold mainly shares of Samsung Electronics and SK Hynix amid concerns that the previous rally in semiconductor stocks had gone too far. Japan’s Nikkei 225 index lost 3.55% to 69,788.38 points.
In the United States, attention is focused on SpaceX shares, which began trading on June 12. After a rapid rise well above $200 per share, the stock has weakened noticeably in recent days, falling 16.4% on Monday to $154.60. According to Purple Trading analyst Petr Lajsek, the euphoria around SpaceX’s market debut is fading quickly, showing that even this company is not immune to exaggerated expectations and basic stock market logic.
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Source: ČTK
