European shares set to fall as global AI rout gathers pace

European shares were set to open lower on Friday amid a global market rout, capping a ‌painful week as investors grappled with uncertainty over AI stocks after Democrats took control of US Congress.

Futures tied to the EURO STOXX 50 Index were down 1% at 6:52 ‌GMT, with contracts tracking benchmarks in Germany and the UK down 0.8% ‌and 0.9%, respectively. Fears that a Democrat-led Congress could seek curbs on AI data-centre spending added to concerns over weak returns, lofty valuations and debt-fueled investment.

A selloff on Wall Street wiped out $2.5 ⁠trillion ​off the tech-heavy Nasdaq ⁠in the previous session, while losses piled on in Asia on Friday. The STOXX 600 index was ⁠relatively less impacted, given its smaller exposure to AI stocks, and was up over 1.3% for ​the week, with a record high just over 1% away. The ⁠index was buoyed by sectors such as healthcare and banks and better-than-feared earnings broadly.

Tech stocks such as ⁠ASML, ​Infineon and AI equipment makers such as Schneider electric and Siemens Energy are likely to stay under pressure as investors rotate out of AI names ⁠that have seen some of the strongest gains this year in the region. On the ⁠earnings front, Daimler ⁠Truck reported a 73% increase in its third-quarter operating profit and confirmed its full-year outlook, helped by a recovery in North ‌American truck ‌demand.