LONDON — European markets resumed their sell-off on Friday, as U.S. tech stock volatility spills over the Atlantic once again.
The pan-European Stoxx 600 ended the session 0.4% lower, with major bourses and most sectors in negative territory.
Global stocks have fluctuated wildly this week, as concerns about AI valuations hang over equity markets. Some respite from a four-day sell-off followed Nvidia's earnings release on Wednesday, but its own gains were quickly reversed during Thursday's trading session as New York-listed stocks lost further ground.
Friday saw Asian chip shares take a battering, while U.S. stock futures rose.
Looking at individual stocks in Europe, Dutch semiconductor firm BE Semiconductor closed 5.6% lower, while chip equipment makers ASMI and ASML fell 4.6% and 6.3%, respectively.
The regional Stoxx Europe Technology index closed 2.3% lower to trade at its lowest level since Sept. 16.
Headlines around a possible peace deal for Ukraine have also been influencing sentiment in Europe in recent days, with reports suggesting Washington and Moscow have been secretly brokering a peace plan to bring the war to an end — potentially forcing Ukrainian President Volodymyr Zelenskyy to make some tough choices.
News agency Reuters reported on Thursday that the peace plan would require Kyiv to concede the entire Donbas region to Moscow and downsize its military.
Zelenskyy, who has previously rejected the notion that his country would give up land to end the conflict, said on Telegram on Thursday night that he had been presented with peace plan proposals from U.S. delegates earlier in the day.
"From the first days of the war, we have upheld one very simple position: Ukraine needs peace. A real peace ... with terms that respect our independence, our sovereignty, and the dignity of the Ukrainian people," he said. "I outlined our key principles. And we agreed that our teams will work on these proposals to ensure it's all genuine."
Defense stocks
European defense stocks sold off on Friday, with the Stoxx Europe Aerospace and Defense index closing 2.1% lower — its worst day in a month. Germany's Renk was 8.4% lower, while shares of Rheinmetall lost 7.2% and Hensoldt dropped 6.6%.
Meanwhile, investors across the globe are also digesting Thursday's long-delayed U.S. nonfarm payrolls report, in the hopes of gauging some clues on the trajectory of American monetary policy. Market expectations of a December rate cut from the Federal Reserve have fallen drastically in recent weeks, with the jobs report — the first since the U.S. government shutdown — painting a mixed picture of the American labor market.
In the U.K., government borrowing costs fell after data showed both consumer sentiment and retail sales had fallen ahead of next week's critical Autumn Budget.
The yield on the U.K.'s benchmark 10-year gilt was last seen trading almost 4 basis points lower at 4.552%.