FX.co ★ AI Trade Reversal Pressures European Stocks

European stocks reversed sharply lower on Tuesday afternoon, closing in negative territory as sovereign bond yields climbed and renewed volatility hit the technology sector. The Euro STOXX 50 fell 1.1% to 6,329, while the STOXX Europe 600 declined 0.5% to 647.

Chipmakers led the selloff: ASML dropped 7.3% and Infineon slid 8.3%, mirroring weakness in AI hardware producers worldwide. A sharp upgrade to Samsung’s quarterly profit guidance prompted investors to reassess the elevated valuations that have underpinned the recent AI-driven rally.

Stocks tied to datacenter power infrastructure also came under pressure. Siemens and Schneider Electric each lost about 4%, while Siemens Energy tumbled 9%.

Outside of technology and related names, most sectors across European markets traded higher. Luxury goods and consumer staples rebounded after Monday’s pullback: L’Oréal gained 2.7%, and both LVMH and Hermès advanced around 1%.