European chipmakers tumble on iPhone demand scare

FE Team | Published: December 28, 2017 00:22:05

PARIS, Dec 27 (Reuters): European tech stocks tumbled on Wednesday as the region emerged from a two-day trading holiday and investors reacted to reports that demand for Apple's iPhone X may be weaker than expected.
The pan-European STOXX 600 slipped by 0.1 per cent, reversing earlier gains as a downturn in the high-performing tech sector outweighed strong mining and oil stocks. Euro zone blue chips also fell 0.1 per cent, with the index slightly down on the month and set for its second straight month of losses.
Tech stocks fell 1 per cent, the worst-performing sector as the market followed a downturn in Asian iPhone suppliers after brokers cut forecasts for iPhone X shipments, saying sales of the new model may undershoot expectations.
Austria Microsystems, the best-performing European tech stock this year, sank 10 per cent while fellow iPhone supplier Dialog Semiconductor dropped 5.5 per cent, the biggest falls on the STOXX.
Chipmakers Infineon and STMicro fell 1.5 and 2.3 per cent respectively to the bottom of the German and French benchmarks. Siltronic and BE Semiconductor also featured among top European fallers.
Despite recent weakness, tech stocks have retained a significant lead over all other sector indexes, up by about 21 per cent this year.
Retail stocks, meanwhile, were set to bring up the rear as the worst-performing, down 3 per cent since January.
Strength in commodities helped to cap losses across the major benchmarks as liquidity remained thin with many investors still on holiday.
Mining stocks rose after metals prices hit 3-1/2 year highs thanks to a strong outlook for growth in China.
Glencore, Randgold Resources and Anglo American contributed the most to index gains.