Deutsche Bank strategists report that US equities, particularly tech and semiconductor names, sold off as Oil prices spiked and AI-related sentiment softened. The Philly semiconductor index and NASDAQ fell sharply, dragging the S&P 500 lower despite broad constituent gains, while European equities held up relatively better thanks to lower chip exposure and earlier market close before the full Oil move.

Tech weakness drags US benchmarks

"Whilst sovereign bonds were struggling, it was also a rough day for equities as the rise in oil prices coincided with a fresh slump for chip stocks."

"The Philly semiconductor index (-4.78%) fell back sharply, with the NASDAQ (-1.55%) also pulling back."

"And in turn, that slump for tech stocks dragged on the S&P 500 (-0.79%), with the index posting a sizeable decline despite most of its constituents rising on the day."

"Meanwhile in Europe, equities put in a relatively better performance, given the region’s comparatively smaller concentration of chip stocks and as European markets closed before the full rise in oil prices, with the STOXX 600 only down -0.01%."

"S&P 500 (-0.09%) and NASDAQ 100 futures (flat) have also been recovering as the overnight session has progressed but with Stoxx (-0.6%) futures still lower."

"The KOSPI (-0.02%) has actually fought all the way back to flat after being down -5%."

"Elsewhere, the Nikkei (-0.25%) has been much less volatile but has also been recovering while I type. The Hang Seng (-0.47%), the CSI 300 (-0.39%), and the Shanghai Composite (-0.66%) are also lower."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)