European Tech Sector Tumbles Amid Low-Cost AI Concerns | Technology
European shares were under pressure on Monday, as the region’s technology sector was hit hard following concerns over China’s introduction of a cost-effective AI model. This development stirred apprehension over the potential profit erosion for rival firms reliant on pricier chips.
The pan-European STOXX 600 reported a 0.6% downturn, while futures linked to the Nasdaq Composite in the U.S. fell sharply by 3.1%. DeepSeek, a Chinese startup, has released an assistant operating on cost-efficient chips, posing a challenge to existing market assumptions about AI-driven demand.
These anxieties weighed heavily on the European tech index, which plummeted 5.8%. Key players like ASML and ASM International faced significant losses, with plunges of 11.5% and over 15%, respectively. Siemens Energy and Schneider Electric, also AI-exposed, experienced notable declines.
(With inputs from agencies.)
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