European Shares Slide Amid Tech Sector Pressures and Regulatory Probes

European shares fell on Friday, impacted by weaknesses in the global technology sector. Zalando faced additional pressure after a probe by Germany's financial regulator. The STOXX 600 index was down, though on course for a weekly gain. Chipmakers and telecom companies also registered declines amid rising memory chip costs.

European shares experienced a downturn on Friday, led by a significant drop in technology stocks, which mirrored global sector trends. Zalando shares fell notably following the launch of an investigation by Germany's financial watchdog into the company's accounts.

The pan-European STOXX 600 index fell by 0.6% to hold at 636.40 by 0832 GMT. Despite this decline, the index was still heading toward a weekly gain. Zalando's shares dropped by 4.3% after BaFin initiated a probe into potential financial discrepancies within the company's statements for 2025. The retail sector as a whole lost 0.2%.

Global uncertainty in the tech sector loomed large, driven by a surge in memory chip prices due to robust demand from AI applications. Asian stock markets had also taken a hit, with Wall Street's Nasdaq futures losing around 1% overnight. Europe's tech shares consequently fell by 1.4%. Chipmakers such as Infineon and STMicroelectronics saw declines of 3% and 2.4%, respectively. Meanwhile, shares of semiconductor equipment firms BE Semiconductor and ASML dropped as well, with upwards pressure from memory chip costs influencing decisions across sectors.