Sales in the technology sector cause Germany's leading index to slip
A sell-off in the technology sector following the results of more U.S. industry giants puts further pressure on the Dax. The German benchmark index continued its strong losses from Thursday, falling over one percent at the open to 17,888 points. This caused it to lose the psychologically important 18,000-point mark it had recently reclaimed in early May.
Negative quarterly reports from U.S. tech giants Apple, Amazon, and Intel dragged the entire sector down. While the numbers from these U.S. companies were partly slightly above expectations, "the bar for the 'Fab Seven' is simply set too high," said Jochen Stanzl, chief analyst at broker CMC Markets. Additionally, investors are "dissatisfied with the overall situation and therefore cautious even with slightly better-than-expected news." Current concerns about global economic growth and the situation in the Middle East are also weighing on sentiment.
Shares of German chipmakers Infineon and Aixtron fell nearly four and over three percent, respectively. Companies particularly sensitive to economic fluctuations, such as food delivery service Delivery Hero, tourism giant TUI, and real estate giant Vonovia, also came under pressure, with their shares losing between one and a half to over five percent. Recent weak economic data from Europe, China, and the U.S. is fueling new recession fears.
The sales of goods in the technology sector might decrease due to the ongoing sell-off, as investor cautions persist even with slightly above-expected reports. This market volatility could negatively impact companies like Infineon and Aixtron, which are heavily reliant on sales of goods.
