European shares drop as ASML warns US tariffs cloud outlook

European shares closed lower on Wednesday, weighed down by semiconductor-related stocks after the world’s biggest chip-making equipment supplier ASML warned that US tariffs were increasing uncertainty around its outlook for 2025 and 2026.

The pan-European STOXX 600 index slipped 0.2 per cent, though it was well off intraday lows by the close. The technology sub-index was the worst hit, down 2 per cent.

Dublin

The Iseq All-Share index ended the session down 0.2 per cent at 10,145.44.

Banking stocks were out of sorts, with AIB off 0.6 per cent at €5.73, Bank of Ireland down 1.2 per cent at €10.36 and PTSB having lost 0.7 per cent to €4.60 amid concerns about the global economy and as sector followers positioned themselves ahead of the European Central Bank (ECB) rates meeting on Thursday.

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In the lead-up to the ECB’s latest policy decision, a final reading of euro zone consumer inflation for March showed inflation rose 2.2 per cent year-on-year.

Markets widely anticipate a 0.25 of a percentage point rate cut from the central bank.

Kenmare edged 0.7 per cent higher to €4.60, but remained well off its recent highs, as the titanium minerals miner’s former managing director, Michael Carvill, and private equity firm Oryx face a deadline on Thursday to at least announced a firm intention to make a takeover bid for the business.

London

Energy shares led the FTSE 100 0.3 per cent higher, as a softer-than-expected inflation print lifted investor sentiment.

The gain for the FTSE 100 extended Tuesday’s rally, which followed US President Donald Trump’s hints at potential exemptions for auto-related tariffs.

The energy sub-index climbed 2.7 per cent as oil prices rose around 1 per cent, with the market drawing some strength from the possibility of trade talks between China and the US and a report that Iraq will cut oil production in April.

Gold miners shone as prices of the precious metal crossed $3,300 for the first time on safe-haven demand. Endeavour Mining led blue-chip gainers with a 6.3 per cent rise, while Hochschild was among the best performers on the midcap index, advancing 5.5 per cent..

Limiting overall gains, distribution group Bunzl slumped 25.3 per cent and posted its worst day on record after cutting its 2025 forecast and pausing its share buyback programme.

Retailer WH Smith fell 1 per cent after reporting a slight dip in first-half profit, although it said it still expects to meet full-year market expectations.

Europe

Shares in ASML slumped 5.2 PER CENT and were the biggest weight on the benchmark Stoxx 600 index.

Also exerting pressure on global chip stocks, Nvidia said on Tuesday it faced a $5.5 billion (€4.84 billion) charge related to its most advanced chip available for sale in China as the U.S. attempts to keep ahead in the AI race.

The outlook for European corporate earnings has worsened on rising uncertainty caused by the tariffs, with analysts expecting companies to report a 3 per cent drop in first-quarter profit, a deeper decline than the 2.2 per cent drop expected just a week ago, according to data compiled by LSEG.

Heineken gained 5 per cent after the world’s second-largest brewer by global volumes beat first-quarter sales estimates and maintained its annual guidance.

New York

Wall Street’s main indexes were lower in early afternoon trading, with chipmakers leading declines on the back of the Nvidia news.

“The long term outlook for Nvidia and the rest of the chip sector is extremely strong, but there is going to be this shroud over the industry for a while as it tries to negotiate with China over trade,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder.

Amid growth worries, investors are hawk-eyed about the results from companies this earnings season.

United Airlines gained after the company reported stable bookings despite forecasting lower profit for the current quarter.

Insurance bellwether Travelers rose, limiting losses on the Dow after reporting stronger-than-expected first-quarter profit.

Tesla fell after Reuters reported that Trump’s tariffs on Chinese parts had disrupted the EV-maker’s production plans. – Additional reporting, Reuters