Europe open: Stoxx still red as tech sell-off continues; Segro surges

(Sharecast News) - European shares opened lower on Wednesday as the tech sell-off continued in the US overnight.

The pan-regional Stoxx 600 index was down 0.02% at 0804 BST with all major bourses lower. US indices closed lower on Tuesday as a global selloff in chip names deepened.

Tuesday's losses were primarily driven by memorychip makers such as Micron, Intel, AMD and Qualcomm. Wall Street's weakness also extended beyond semiconductors, with Alphabet slipping another 0.77% after a 5% fall on Monday amid concerns over highprofile AI talent departures.

The broad retreat follows a sharp reversal in tech sentiment that began at the start of the week and has since accelerated across global markets, with South Korea's benchmark, which was up 95% this year, down almost 10%, while Japan's Nikkei 225 shed 3.55% - breaking an eight-session winning streak.

"The technology stocks, especially those that spiked in a parabolic move, are being battered due to their massive AI spending, increasingly financed by debt, with an unclear path to profitability for some of them, and the prospects of higher interest rates that will increase the cost of debt in the months to come," said Swissquote analyst Ipek Ozkardeskaya.

"Note that the unease in US tech stocks started after the latest Federal Reserve announcement, which came in more hawkish than expected, as the new chair Kevin Warsh put 'price stability' at the centre of his statement. The dot plot suggested that half of the Fed members are looking for at least one rate hike this year to tame inflation, which spiked above 4% last month for the headline figure and remains near the 3% mark for the core figure."

Oil prices fell as US President Donald Trump tried to shift attention away from his handling of the Iran war and its impact on the domestic economy by accusing big oil companies of "gouging" consumers and threatening a Department of Justice probe.

"The big Oil Companies are not dropping their price at the pump commensurate with the sharply lower prices they are paying for Oil. Those prices are dropping like a rock! In other words, customers are being "gouged." I have instructed the DOJ to immediately start looking into this. Gasoline prices better start going down a lot faster than what I'm seeing! President DJT," he wrote on social media.

Brent crude was down 1.41% to $76, while US benchmark West Texas Intermediate fell 1.35% to $72 a barrel.

In equity news, shares in Segro surged as US logistics firm Prologis said the warehouse landlord rejected its �12.6bn all-share takeover proposal.

Reporting by Frank Prenesti for Sharecast.com