PARIS: European shares fell on Wednesday, dragged by a drop in shares of chipmakers and British drugmaker AstraZeneca, while increasing concerns over an escalation in the Middle East conflict further weighed on sentiment.
The pan-European STOXX 600 index was down 1.1%, its lowest level in over a week. A strike on a Gaza hospital that killed hundreds of Palestinians raised the stakes for US President Joe Biden’s visit to Israel.
ASML Holding lost 3.4% as the semiconductor equipment maker reported lower-than-expected orders and warned of flat sales next year.
Shares of other chipmakers such as ASM International, Aixtron and BE Semiconductor also shed between 0.8% and 4.5%, dragging Europe’s technology sector down 2.2%.
“Today, the disappointing (semiconductor) results are going to be the one dominating the news because it’s a big and important sector for Europe,” said Anthi Tsouvali, multi-asset strategist at State Street Global Markets.
“In general, earnings expectations remain high and they seem to be very optimistic for a region which is an energy importer. If energy prices continue to climb higher, that’s going to be an issue.” The burgeoning uncertainty over the Middle East war, a slew of mixed earnings reports and a jump in bond yields after better-than-expected US economic data have kept European shares under pressure this week.
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