ASML's Strong Forecast Lifts Tech Stocks While Middle East Tensions Weigh on European Equities
Claire Weston
ASML raised its 2026 financial outlook and surged 6%, pulling the chip sector higher — but Iran's closure of the Strait of Hormuz pushed oil to $85 a barrel, and the resulting risk-off mood kept the broader European market under pressure.
Why did ASML lift the entire tech sector?
ASML raised its 2026 financial forecast; shares jumped 6%. Chip-equipment maker ASM International and wafer-materials firm Soitec each rose over 2%.
This means → the market renewed its confidence in AI-driven chip demand, especially after investors had begun questioning whether the rally could last following a strong Q2 rebound.
The tech sector gained 1.4% overall — the only clearly rising group in the Stoxx 600 on the day.
Why were software stocks falling instead?
Germany's SAP dropped 2%, dragging the DAX down nearly 1%. France's Dassault Systèmes and Capgemini each fell more than 1%.
In plain terms = the investor logic is straightforward: the stronger AI gets, the more likely traditional software is to be displaced. Money has been flowing out of stocks seen as "potential AI losers" all year.
This reflects a market that is redistributing winners and losers within the same AI theme, not buying or selling the sector wholesale.
How did the Middle East situation affect the broader market?
Iran closed the Strait of Hormuz — the chokepoint through which roughly one-fifth of global oil shipments pass. U.S.–Iran tensions continued to escalate, pushing oil to $85 a barrel.
This means → rising energy costs plus geopolitical uncertainty made investors more cautious as they reviewed earnings — the Stoxx 600 slipped 0.1% to 641.07.
Richemont, Cartier's parent company, bucked the trend with a 5.3% surge after Q1 results beat expectations on strong jewelry demand in Asia and the Americas — proof that individual earnings can still cut through macro gloom.
What comes next?
Whether the tech-versus-software divergence persists depends on whether upcoming earnings can keep validating the real strength of AI demand.
In plain terms = ASML's forecast gave the market a shot of confidence, but one company's signal is not enough — investors need more chip firms to relay the baton with their own results.
Oil prices and Middle East tensions form a separate thread: if escalation continues, even good tech-sector news will face a lower ceiling on the broader market.
Content is for reference only, not financial advice.