European stock markets weakened during Thursday’s trading session (October 5), with the Euro Stoxx 50 falling 0.9% and the Stoxx 600 declining 0.4%. The primary downward pressure stemmed from a massive sell-off in the technology sector, which dropped by more than 4%, mirroring a broader global decline in artificial intelligence (AI)-related stocks.
Pressure on tech stocks intensified following the Democratic Party's victory in the U.S. midterm elections, which sparked concerns regarding potential regulatory tightening and increased oversight of data center projects. Investors fear that such policies could slow the expansion of AI infrastructure while simultaneously dampening demand for semiconductors.
Shares of ASML Holding plunged 7%, making it one of the biggest drags on the European tech sector. This decline reflects investor anxiety that policy shifts in the U.S. could disrupt global technology supply chains—particularly for companies with significant exposure to the semiconductor and data center industries.
Outside the tech sector, shares of Rheinmetall fell by more than 16% after the company lowered its full-year performance outlook, making it one of the worst-performing stocks in European trading.
Meanwhile, Deutsche Telekom shares dropped nearly 2% following the announcement of a €2 billion share buyback program. The figure fell short of market expectations, failing to generate a positive sentiment for the company’s stock.
Newsmaker Analysis: The weakness in European markets suggests that global sentiment toward the technology and AI sector is facing fresh headwinds. Investors are now weighing not only the growth prospects of AI but also regulatory risks, the scale of required investment, and the potential for a slowdown in data center expansion.