European shares slipped on Wednesday as worries over global trade persisted, with sentiment towards semiconductor stocks in particular souring after Micron Technology was banned from selling chips in China.
Trading has been choppy before a July 6 deadline when the United States is set to impose tariffs on $34 billion worth of goods from China.
The tit-for-tat saga has hit market sentiment in recent weeks. News a Chinese court temporarily banned Micron Technology (MU.O) from selling chips in China, the world’s biggest memory chip market, hitting shares in U.S. and Asian semiconductor stocks, reports Reuters.
“The biggest risks to the technology sector are regulation and global semiconductor disruption from an escalating trade war,” Peter Garnry, head of equity strategy at Saxo Bank, said.
“At this point, the probabilities for both scenarios having major impacts on the technology sector in the short term are low,” Garnry said.
Europe’s tech sector .SX8P fell 0.5 percent lower. Chipmaker STMicro (STM.MI) was down 2.8 percent and Infineon (IFXGn.DE) .7 percent. Silicon wafer-maker Siltronic WAFGN.DE dropped 5.8 percent .
Recent guidance cuts from BE Semiconductor (BESI.AS) and Osram Licht (OSRn.DE) have also weighed on sentiment around the sector, which has fallen more than 9 percent since June’s 17-year high.
Smaller Swiss stock Comet (COTNE.S), whose business focuses on X-ray and radio frequency technology, issued a sales and profit warning for 2018 and saw its shares plunge nearly 18 percent.
Elsewhere, shares in Danske Bank (DANSKE.CO) were among the biggest STOXX fallers, down 3 percent. A report citing fresh data in the bank’s Estonian money-laundering case suggested its extent was greater than previously reported.
More broadly, gains across defensive sectors limited losses on the STOXX. Telecoms .SXKP rose 1.2 percent and utilities .SX6P and health care .SXDP each gained around 0.2 percent.