European stocks fell sharply on Friday led by technology, which echoed a late-session selloff on Wall Street. Profit warnings in the renewables sector sent the shares of two Siemens subsidiaries tumbling.
The Stoxx Europe 600 index
SXXP,
-1.40%
fell 1.4% to 476.48, following a 0.5% gain on Thursday. The index is poised for a nearly 1% drop this week. The German DAX
DAX,
-1.55%
fell 1.4%, with a similar loss for the CAC 40
PX1,
-1.42%,
while the FTSE 100 index
UKX,
-0.95%
dropped 1%.
U.S. stock indexes surrendered an early rebound to turn lower in Thursday’s final hour of trading, a repeat of Wednesday’s volatile session. The worst losses were seen for the Nasdaq Composite
COMP,
-1.30%,
which fell 1.3%, pushing further into correction territory.
Stocks have struggled at the start of the year amid a selloff in bonds as investors look ahead to tighter policy from Federal Reserve. The yield on the 10-year
TMUBMUSD10Y,
1.790%
fell 1 basis point to 1.79%, while the yield on the German 10-year bund
TMBMKDE-10Y,
-0.049%,
which pushed into positive territory for the first time in three years this week, slipped 1 basis point to negative 0.041%.
A bumpy start to earnings season has also added to the gloom, with Netflix
NFLX,
-1.48%
shares dropping 20% late Thursday, after the streaming giant’s subscriber number outlook fell far short of expectations. S&P 500 futures
ES00,
-0.32%
were pointing lower, while Nasdaq-100 futures
NQ00,
-0.66%
fell 0.6%.
While tech led the losses in Europe, few sectors showed any green. Among chip names in Europe, heavily weighted ASML Holding
ASML,
+1.09%
ASML,
-2.39%
dropped 3%, and ams
AMS,
-1.29%
shares fell 3%, while business software group SAP
SAP,
+0.16%
SAP,
-1.32%
was down 1.2%.
Energy names were under pressure as a risk-off mood hit oil prices
CL00,
-2.03%
BRN00,
-1.82%,
and BP
BP,
-1.80%
BP,
-2.31%
and Royal Dutch Shell
RDS.A,
-2.58%
RDSA,
-1.21%
shares fell 1% each.
The renewables sector was getting hammered, after Siemens Gamesa Renewable Energy
SGRE,
-12.98%
late Thursday cut its guidance for the fiscal year, swinging to an operating loss in the first quarter on continued supply-chain woes. Shares slumped 14%.
The warning from its Spanish subsidiary prompted Siemens Energy
ENR,
-10.90%
to lower its targets for fiscal 2022, and shares tumbled 10%. Those of rival Vestas Wind Systems
VWS,
-6.58%
dropped 6%.
Elsewhere, shares of Airbus
AIR,
-1.57%
dropped 1.5%, after the multinational aerospace corporation canceled a plane order from state-owned carrier Qatar as the two companies have been in dispute for months over surface degradation on A350 jets.