Tech and trade fears weigh on stocks
European stocks retreated yesterday as investors began the second quarter in a fragile mood amid international trade tensions and mounting pressure on big technology companies.
The pan-European STOXX 600 ended the day down 0.5pc after falling more than 1pc earlier in the session. The index was supported in afternoon trading by a slight rebound on Wall Street.
Germany's DAX was a clear underperformer, losing about 0.8pc while industrials, financials and healthcare stocks weighed on European indexes.
The tech sector dropped 0.8pc, after an overnight report that Apple plans to replace Intel chips in Macs with its own.
The index has fallen about 7.5pc in the past three weeks as anxiety grew over big tech companies with the focus on Facebook's use of data, and regulation of Amazon. Reports of Apple increasingly going down the 'insourcing' route have dented shares in Apple suppliers around the world, most notably Europe's Dialog Semiconductor, down 3.5pc.
STMicro shed 2.9pc, while ams declined 2.3pc and Infineon fell 2.1pc.
Risk appetite was poor across the board, as European investors followed US and Asian investors to the exit after China retaliated against US tariffs.
"We believe that risk-reward for stocks has not turned medium-term negative, and would be adding at these levels," wrote JP Morgan strategists in a note.
Equities have again entered "oversold" territory, they said, adding, however, that headwinds for technology stocks were increasing.
Outside the tech sector, food services group Sodexo slumped 4.5pc after Goldman Sachs cut the stock to "neutral". Sodexo had already suffered a 15.7pc decline.