July 8 (Reuters) – European shares fell on Wednesday after renewed tensions in the Middle East rattled investors, while technology stocks flitted between gains and losses as markets assessed whether the sector’s recent global rally could be sustained.
The pan-European STOXX 600 index was down 0.6% at 642.22 points, as of 0716 GMT.
Energy price-sensitive sectors such as auto stocks dropped the most, down 1.6%, while banks slid 1.3%.
Shares of Air France and Wizz Air lost more than 2% each as crude prices climbed on renewed geopolitical tensions.
Lufthansa slipped 4% after Citigroup downgraded the stock rating to “sell” from “neutral”.
Tensions between the U.S. and Iran were high after the two adversaries traded fire and Washington revoked a licence allowing Tehran to sell oil that is likely to threaten the tenuous ceasefire that has held between both parties.
Investors also kept a close watch on technology stocks, which have had a shaky start to July after a strong AI-driven rally in the previous quarter.
South Korean equities closed 20% below a record-high level last seen in June, confirming a bear market. The tech-heavy Nasdaq in Wall Street closed below its 50-day moving average, indicating weak short-term momentum.
European technology stocks traded in different directions, as chip equipment maker ASML rose 1%, while semiconductor stocks Soitec and Aixtron fell more than 1% each.
Bucking the broader gloom, Swedish broadband provider Bahnhof jumped 18% after telecom operator Telenor agreed to buy a controlling stake in the company in a deal valuing it at 6.1 billion Swedish crowns ($629.7 million).
(Reporting by Johann M Cherian and Tharuniyaa Lakshmi in Bengaluru; Editing by Sherry Jacob-Phillips)
