Tech shares take a tumble, with the slump in tech sales spreading across Europe; all eyes are now on Micron

 (Il Sole 24 Ore Radiocor) - The long-awaited correction in tech shares may have arrived. Or perhaps not. The question remains open, but in the meantime, the sell-off that began in New York the previous day has spread first to Asia and then to Europe, with the market once again expressing concern over Big Tech’s investments in AI and questioning the actual returns, in light of current valuations.

Consequently, Nasdaq futures are pointing to a 2.7% fall; in South Korea, the Kospi has lost 10 per cent; and in Japan, the Nikkei has fallen by 3.5 per cent, weighed down by the tech sector, and in Europe, the sector-specific Eurostoxx is down 3.2%, whilst the worst-performing index is the Amsterdam AEX (-1.8%), where semiconductor companies carry greater weight (ASM International is down 6.4%, BE Semiconductor by 5.6 per cent and ASML Holding by 5 per cent).

On the Milan Stock Exchange, Stmicroelectronics is dragging the market down, falling from the record highs of recent days and returning to the levels seen around ten days ago, at 64.50 euros (-7%). It is worth noting that SpaceX is also heading for another session in the red: after losing 16% yesterday, the share price is down 4.5% in pre-market trading at $147.5, at its lowest level since listing and a long way from its record high of $225. Elon Musk’s company has announced that it will issue a $20 billion bond to fund its expansion into AI.

The rally in tech shares has particularly affected semiconductor and memory manufacturers, and “there has been no fundamental catalyst, and it is to be hoped that one does not emerge tomorrow with Micron Technology’s earnings”, note analysts at MPS. The chip giant has gained over 300 per cent since January, and the market will be watching closely for guidance on capital expenditure and pricing.

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