European shares edge lower as Apple margin warning trigger global tech rout

 European shares slipped on Tuesday, succumbing to a worldwide sell-off across technology bourses after Apple warned of margin compression from rising chip costs, while a $20 billion capital raise by Oracle reignited investor anxiety over artificial intelligence funding and cash burn. 

The pan-European STOXX 600 index slipped 0.1%, while Germany’s DAX fell 0.2%. France’s CAC 40 was up 0.2% while London’s FTSE 100 declined 0.7%. 

The drawdown was led by the technology sector after Apple warned that persistent inflation in memory chip prices would squeeze gross margins through the crucial holiday shopping quarter.

The continent’s semiconductor ecosystem - including lithography giant ASML, assembly equipment makers ASM International and BE SemiconductoR all fell between 2% and 4% and chip suppliers STMicroelectronics and Infineon - trades as a direct proxy for global consumer electronics hardware and datacenter supply chains - fell over 3% each. 

With the world’s most valuable tech platform signaling that higher component bills are eroding profitability, European semiconductor suppliers came under sharp selling pressure amid fears that hardware makers will either absorb margin compression or face demand destruction if input expenses are passed on to consumers.

The hardware chill was compounded by news that enterprise software giant Oracle plans to raise $20 billion through a combination of bond and share sales to fund its aggressive cloud infrastructure and datacenter expansion.

“Alphabet, Amazon, Meta, Microsoft, Tesla and Apple have now all released their latest quarterly results and been met with varying degrees of scepticism, so all eyes are now switching to Nvidia’s third-quarter numbers that are due on 17 November,” said AJ Bell’s investment director, Russ Mould.

This week, about 20% of the STOXX 600 companies are expected to report their quarterly results, marking one of the busiest stretches of the European third-quarter earnings season.

German airline group Lufthansa saw its shares gain 1.6%. The management narrowed its full-year 2026 operating profit forecast due to soaring jet fuel costs tied to Middle Eastern supply tensions.

Conversely, healthcare giants helped cushion tech loses. Dutch medical technology heavyweight Koninklijke Philips advanced 6% after posting higher quarterly profit.

Bayer surged 6% after the German pharma group beat analyst expectations on both revenue and operating profit, while simultaneously lifting its full-year outlook.

U.S. midterms test Trump’s second-term agenda

Cross-asset flows were further restrained by caution ahead of Tuesday’s U.S. midterm elections, with American voters heading to the polls to deliver a referendum on the first two years of President Donald Trump’s second term.

A Democratic-controlled or divided Congress would introduce legislative gridlock, slowing domestic deregulatory momentum and raising the stakes for upcoming federal debt ceiling negotiations, while potentially curbing federal spending initiatives.

With investors also awaiting Friday’s October U.S. nonfarm payrolls report to gauge the Federal Reserve’s December interest-rate trajectory, dealing desks maintained low risk profiles across European bourses.

Among other earnings moves, Truecaller fell 17% after the Stockholm-listed caller-identification company reported a third-quarter net loss and issued a cautious outlook on user growth.

TeamViewer fell as much as 18% after lowering its full-year revenue growth forecast.

Drax rose 9% after the power firm partnered with Radiant to develop a data centre in a project that could attract ⁠£20 billion in funds.