European shares snap four-week winning streak on tech selloff, US-Iran war

An ongoing rotation out of global tech heavyweights and into other areas of the market also weighed on sentiment, as investors sought diversification beyond the most obvious AI beneficiaries. Markets will now turn their attention to the upcoming earnings season to bring the spotlight back on fundamentals and potentially provide fresh momentum to equities. The technology sector was off 1.3% on Friday, and 1.8% for the week. Soitec and ASML dropped 5.9% and 2.1%, respectively, on the day. "The large swings we're seeing in technology stocks... suggest investors remain under stress amid elevated valuations," said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank. European shares ended a four-week winning streak on Friday, buffeted by an unwind in tech stocks and resurgent tensions in the Middle East that rattled oil markets. The pan-European STOXX 600 lost 1.8% during the week, as investors dialled back hopes that the energy supply shock would ease soon. The U.S. and Iran traded strikes, while Washington re-imposed sanctions on Iranian oil, sending Brent futures up 5% for the week. Adding a layer of uncertainty was the NATO summit in Turkey, where U.S. President Donald Trump called Spain a "terrible partner" and threatened to halt trade with the country, before softening his rhetoric later. Taken together, the week's developments highlighted that geopolitical risks remain an important factor shaping investor sentiment. "There was a certain complacency that the war is no longer an issue. And we're reminded this week that it is, in fact, still an issue," said Marta Norton, chief investment strategist at Empower. Telecom stocks climbed 1.3%, lifted by a 12.6% jump in Vodafone after UAE telecoms group e& said it would sell its stake in the company to the family group of French billionaire Xavier Niel. Travel and leisure stocks advanced 1%, with airlines largely higher. The UK's easyJet surged 14.3% after it agreed in principle to a £5.7 billion ($7.65 billion) takeover offer from Apollo Global. St. James's Place was the biggest laggard on the STOXX 600, dropping 8.5% after a report said Sovereign Wealth, one of the money manager's largest partner firms, was eyeing an exit from the group. J.P. Morgan turned "constructive" on the European steel sector, and upgraded ArcelorMittal to "neutral" from "underweight", sending its shares up 6.4%. Voestalpine and Salzgitter gained more than 6% each, and the brokerage double upgraded the stocks to "overweight" from "underweight". Ryanair settled 0.9% higher, paring gains after rising as much as 2.9% during the session. A passenger was partially sucked through a dislodged window on a Ryanair flight shortly after takeoff from Thessaloniki in Greece, two airport sources said, forcing the aircraft to make an emergency landing. Volkswagen fell for the third consecutive day. The company's powerful labour representatives have blocked a sweeping restructuring plan, two company sources told Reuters. The automaker also reported an 8.6% fall in global vehicle deliveries in the second quarter on Friday, the steepest quarterly decline in four years.

European shares snap four-week winning streak on tech selloff, US-Iran war

Tech weakness weighs on sentiment

European shares end weekly winning streak

Company moves include Vodafone, easyJet and Volkswagen

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