(Reuters) – European shares slid on Monday as the technology sector joined the retreat in other markets after China’s upgraded low-cost, low-power artificial intelligence (AI) model sparked worries about the profits of rivals and the need for costly tech.
The pan-European STOXX 600 was down 0.7% of 0815 GMT. U.S. Nasdaq Composite futures tumbled 3.1%, while S&P 500 futures sank 1%.
Startup DeepSeek has rolled out a free assistant that it says uses lower-cost chips and less data, seemingly challenging a widespread bet in financial markets that AI will drive demand along a supply chain from chipmakers to data centres.
The news rattled European tech stocks as well, which slid 4.5%. Chip equipment maker ASML (AS:ASML) slid 8.7%.
Siemens (ETR:SIEGn) Energy, which provides electric hardware for AI infrastructure, sank 17.7%, while AI darling Schneider Electric (EPA:SCHN) dropped 8.1%.
The week ahead is packed with key interest rate decisions by central banks around the globe, with the Federal Reserve and European Central Bank policy verdicts in particular focus.
Fourth-quarter gross domestic product numbers for the euro zone and Germany, along with inflation data for major European economies, are also part of a data-loaded week.
Among other stocks, Ryanair added 2.1% after the low-cost carrier posted a bigger-than-expected quarterly profit.
British American Tobacco (NYSE:BTI) was up 4% after the Donald Trump administration withdrew plans to ban menthol cigarettes.