European Markets Retreat as AI Sector Faces Correction

A cooling global sentiment hit European equities Thursday morning, with the STOXX 600 index shedding 0.1% to reach 638.27 points. The decline follows a sharp overnight retreat in AI-linked stocks across Wall Street and Asian markets, forcing investors to recalibrate positions ahead of critical American employment data.

Editorial·July 2, 2026·reads: 362

The tech sector bore the brunt of the selling pressure, dragging the STOXX 600 tech index down by 1.5%. Semiconductor-linked firms felt the impact most acutely: Soitec shares tumbled 5.1%, while Aixtron retreated 3.6%. These losses underscore a broader shift in investor appetite following a quarter of aggressive valuation growth for artificial intelligence plays.

Contrasting the broader tech slump, Sodexo provided a rare bright spot for the index. The company surged 6.5% after management lifted its full-year organic revenue growth forecast, buoyed by strong third-quarter results. Market participants are now shifting their attention to U.S. June nonfarm payrolls, which remain the primary indicator for the Federal Reserve’s future monetary policy path as the central bank moves away from providing forward guidance.

European Markets Retreat as AI Sector Faces Correction

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