European Shares Decline as AI Tech Sell-Off Offsets Earnings
European stocks fell Thursday as a global sell-off in AI technology shares outweighed positive corporate earnings following high U.S. inflation data.
European shares declined on Thursday, with the pan-European STOXX 600 index dropping 0.16%. The decline was driven by a global sell-off in AI-related technology stocks, which offset positive corporate earnings reports. The technology sector fell 2.7%, led by significant losses for chip makers including ASML Holding, Infineon, Soitec, and Aixtron.
Investors reacted to high U.S. inflation data, which sparked fears that the Federal Reserve would implement further rate hikes. Such moves would increase borrowing costs for companies funding AI infrastructure. LSEG data indicates an 84% probability that the European Central Bank will also raise rates in December.
Corporate results were mixed. Ericsson shares rose 8.3% after reporting third-quarter net sales that beat analyst expectations and a smaller-than-expected profit drop. Pernod Ricard also saw gains following a smaller-than-expected drop in first-quarter sales. In contrast, Mondi shares tumbled 10.8% after the company raised prices to offset costs, and Antofagasta shares slid 6.2% following a reported drop in copper production.
