European Tech Shares Plummet as China's AI Innovation Sparks Market Concerns

European tech shares tumble as China's AI push spooks investors

European shares slid on Monday as the technology sector joined the retreat in other markets after China's upgraded low-cost, low-power artificial intelligence (AI) model sparked worries about the profits of rivals and the need for costly tech. The pan-European STOXX 600 was down 0.7% of 0815 GMT. U.S. Nasdaq Composite futures tumbled 3.1%, while S&P 500 futures sank 1%. Startup DeepSeek has rolled out a free assistant that it says uses lower-cost chips and less data, seemingly challenging a widespread bet in financial markets that AI will drive demand along a supply chain from chipmakers to data centres. The news rattled European tech stocks as well, which slid 4.5%. Chip equipment maker ASML slid 8.7%. Siemens Energy, which provides electric hardware for AI infrastructure, sank 17.7%, while AI darling Schneider Electric dropped 8.1%. The week ahead is packed with key interest rate decisions by central banks around the globe, with the Federal Reserve and European Central Bank policy verdicts in particular focus. Fourth-quarter gross domestic product numbers for the euro zone and Germany, along with inflation data for major European economies, are also part of a data-loaded week. Among other stocks, Ryanair added 2.1% after the low-cost carrier posted a bigger-than-expected quarterly profit. British American Tobacco was up 4% after the Donald Trump administration withdrew plans to ban menthol cigarettes.

European tech shares tumble as China's AI push spooks investors

(Reuters) - European shares slid on Monday as the technology sector joined the retreat in other markets after China's upgraded low-cost, low-power artificial intelligence (AI) model sparked worries about the profits of rivals and the need for costly tech. The pan-European STOXX 600 was down 0.7% of 0815 GMT. U.S. Nasdaq Composite futures tumbled 3.1%, while S&P 500 futures sank 1%. Startup DeepSeek has rolled out a free assistant that it says uses lower-cost chips and less data, seemingly challenging a widespread bet in financial markets that AI will drive demand along a supply chain from chipmakers to data centres. The news rattled European tech stocks as well, which slid 4.5%. Chip equipment maker ASML slid 8.7%. Siemens Energy, which provides electric hardware for AI infrastructure, sank 17.7%, while AI darling Schneider Electric dropped 8.1%. The week ahead is packed with key interest rate decisions by central banks around the globe, with the Federal Reserve and European Central Bank policy verdicts in particular focus. Fourth-quarter gross domestic product numbers for the euro zone and Germany, along with inflation data for major European economies, are also part of a data-loaded week. Among other stocks, Ryanair added 2.1% after the low-cost carrier posted a bigger-than-expected quarterly profit. British American Tobacco was up 4% after the Donald Trump administration withdrew plans to ban menthol cigarettes. (Reporting by Nikhil Sharma; Editing by Savio D'Souza)