Stock market: Europe in the red amid AI fears; in Milan (-1%), tech shares face a sell-off
Tensions in Iran and the run-up to the US mid-term elections are also having an impact
(Il Sole 24 Ore Radiocor) - European stock markets opened lower, following yesterday’s close of the Nasdaq and S&P yesterday and the Kospi in Seoul today (whilst the Nikkei in Tokyo is closed for a public holiday), with the market continuing to debate the existence of a potential artificial intelligence bubble. Consequently, Milan’s FTSE MIB is down 1 per cent, whilst Paris’s CAC (-0.5 per cent) and Frankfurt’s DAX (-0.8 per cent) are also falling. The AEX in Amsterdam (-0.6%), the IBEX in Madrid (-1%) and the FTSE 100 in London (-0.4%) fared no better. Adding to the nervousness surrounding the AI sector – with investors wondering when they will see a return on companies’ substantial investments – is the uncertainty ahead of today’s mid-term elections in the United States.
This is accompanied by a resurgence of tensions in Iran, with the US – according to the Wall Street Journal – reportedly having attacked the island of Qeshm yesterday, whilst, according to Ynet News, a senior Iranian official is reported to have said that ‘Iran and the United States are a long way from reaching an agreement to end the war’. Renewed fears of an escalation are thus driving up energy commodity prices, with Brent crude rising by 1.5 per cent to $106.3 per barrel and WTI to $97.9 (+1.5 per cent). Gas prices in Amsterdam are also rising again to €98.4 per MWh (+3.7%), whilst the IEA has sounded the alarm over European gas stocks, which are at their lowest levels since 2013.
On the stock market, tech-related shares took a heavy hit on the Milan Stock Exchange, with Prysmian falling by 2.97 per cent, ST by 3.68 per cent and Technoprobe by 2.57 per cent. Oil stocks were also down, despite the rise in crude oil prices: Tenaris fell by 2.92 per cent, Saipem by 2.27 per cent, whilst Eni limited the damage (-0.4 per cent). Stellantis also fell (-1.37%), with October car registrations down by 5.5 per cent. Lottomatica bucked the trend (+2.3%), buoyed by the results released this morning, which showed growth in profits and revenue. There was also buying interest in Terna (+0.44%) and Snam (+0.39%).
In the foreign exchange market, the euro/dollar exchange rate has risen to 1.12 (from 1.1198 at yesterday’s close). The single currency is also trading at 176.89 yen (176.76), whilst the dollar/yen cross rate stands at 157.87 (157.85).
