European markets trended lower on Wednesday as a disappointing earnings report from Dassault Systèmes fueled anxieties about artificial intelligence disrupting traditional business models.
The STOXX 600 index dipped 0.2%, with France’s CAC 40 bearing the brunt of the losses. Dassault’s stock plunged nearly 20% after the software manufacturer reported quarterly revenue growth of just 1%, missing investor expectations and highlighting vulnerabilities in the software sector. This selloff extended to the broader technology and insurance sectors, the latter of which was rattled by a Barclays downgrade following the release of a new ChatGPT-integrated insurance tool.
Despite the general downturn, certain companies managed to buck the trend through strategic gains or strong financial performance. Hardware providers like Siemens Energy saw shares climb 5.2% after reporting that net profits nearly tripled, driven by the massive infrastructure demands of the AI boom.
Additionally, the London Stock Exchange Group rose 2.7% amid reports that activist hedge fund Elliott Management has acquired a notable stake in the firm.
Meanwhile, beverage giant Heineken saw a 4.4% increase in its share price after announcing plans to reduce its global workforce by 6,000 positions to streamline operations.
On the FX front, the Japanese yen climbed sharply on Wednesday as market participants reacted to Prime Minister Sanae Takaichi’s decisive election win, which is expected to grant her significant control over the country’s upcoming fiscal policies.
This yen strength, combined with disappointing US economic data released on Tuesday, pressured the dollar ahead of the crucial non-farm payrolls report.
As a result, the dollar index fell 0.33% to 96.60, while the Australian dollar managed to break past the $0.71 mark for the first time in three years.
In Asian trading, the yen rose nearly 1% against the greenback to reach 152.94, extending a rally that began the previous day.
This momentum also saw the Japanese currency gain ground against other major peers; the euro dropped 0.7% to 182.27 yen following a sharp decline on Tuesday, and the British pound slid 0.73% to 209.04 yen, continuing its recent downward trend.
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