Europe's Tech Stocks Tumble, ASML Hits Higher Sectors

(Bloomberg) - Technology stocks fell and the Big Pan Index faltered as ASML Holding NV announced orders far below analysts' expectations.

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The Stoxx Europe 600 Index opened broadly flat, as comforting results from LVMH lifted luxury stocks, but a slump in ASML hurt tech peers and dampened the rally. The Stoxx 600 tech index has risen 25% over the past year, with ASML leading the sector with a gain of more than 50%.

Swissquote (Swissquote) senior analyst Ipek resonance - Ozkardeskaya (Ipek Ozkardeskaya) that it is "a series of unfavorable factors" on the market pressure. The growing likelihood that the U.S. Federal Reserve (Fed) will postpone a rate cut, and ASML's mixed bag of industry merit, are some of the major concerns in the market, she said.

Fed chief Jerome Powell pointed out Tuesday that the Fed lacks new progress on inflation after a rapid decline in the rate late last year, noting that officials may need more time before lowering borrowing costs to gain the necessary confidence that price growth is on track to meet the Fed's 2% target.

After a series of hot US economic data in recent weeks, expectations of a rate cut have been pushed back, and after a strong first quarter, European equities were dragged down in April. Against a backdrop of geopolitical tensions, all eyes turned to earnings, with volatility indicators moving into worry territory for the first time since last year.

Geopolitical concerns further dampened sentiment as Israel weighed its response to Iranian missiles and drone strikes.

"Rising risk aversion continues to weigh on risky assets, to the detriment of equities and in support of the dollar and gold," said Daniel Varela, chief investment officer at Piguet Galland & Cie SA. That said, with investor sentiment very low, stocks could "gradually regain ground in the coming days if political tensions ease," Varela added.

Focus on the industry:

• LVMH, the bellwether of Europe's luxury goods industry, said sales growth slowed at the start of the year, with a slight decline in performance. Investors may have been prepared for a downturn after its peer Kering issued a sales warning last month.

• Tobacco giants Imperial Brands and British American Tobacco are likely to strengthen today as British ministers voted last night to ban people born in 2009 or later from buying cigarettes.

For more information on the stock market:

• The stock market is on a real slippery slope: Rocky Point

• European Watch: Vinci, Naturgy, UniCredit, Alfa-Bank, Talgo

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• U.S. Stock Futures Rise; United Carbide, Tesla Gain Ground

• Superdry exits London Stock Exchange: London hot (rightly)

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