After a good run recently, the European industry index Stoxx Europe 600 Technology fell by almost 3 percent at the start of the week. It comes from the highest level since April 2022. This made tech stocks the weakest industry on Monday and dragged stock markets down overall. Since the beginning of the year, however, the sector has still recorded an increase of around 14 percent.
Tech stocks are considered particularly sensitive to interest rates, which is making investors nervous ahead of the upcoming interest rate decisions by the US Federal Reserve, the European Central Bank and the Bank of England. In addition, the tech giants Meta, Amazon, Alphabet and Apple will present business figures over the course of the week, which should send important signals for the industry.
As a result, tech investor Prosus brought up the rear in the EuroStoxx with losses of 6.7 percent. Chip supplier ASML also went down significantly with 3.6 percent. In this country, Infineon dropped by 3 percent. Bayern will present figures on Thursday.
Additional headwind came from reports of restrictions on chip shipments to China. As the Bloomberg news agency recently reported, Japan and the Netherlands, two other important chip locations, want to join the USA’s planned export restrictions on China. According to analyst Amit Harchandani from the US bank Citigroup, concerns about a complete ban on exports of lithography systems are increasing, which is putting market leader ASML under pressure.
However, ASML itself emphasized that the new regulations should not have a major impact on sales in the current year. In addition, it will still take some time before the regulation will find its way into legislation. However, indirect effects of the restrictions on ASML are likely to weigh on sales by 5 percent, wrote Alexander Duval from the US investment bank Goldman Sachs. If the Netherlands actually join the export restrictions, the consequences for ASML will probably be even more direct and extensive.
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