Tech rebound lifts European stocks, chipmakers jump By Reuters

By Sruthi Shankar

(Reuters) -European stocks rose on Wednesday after one of the worst market routs this year, with investors picking up beaten-down shares of technology sector, while chip equipment maker ASML gained on upbeat earnings forecast.

The pan-European index rose 1% after shedding 2.2% in the previous session in their biggest percentage daily decline since mid-July.

Global stocks tumbled on Tuesday as U.S. government bond yields surged on growing expectations of faster interest rate hikes by the Federal Reserve and steered investors away from high-growth technology stocks.

European tech sector was up 1.5% after losing 4.8% on Tuesday. ASML Holding (NASDAQ:) NV, one of the key suppliers to computer chip makers, rose 1.8% after raising financial targets.

ASM International (OTC:) jumped almost 6% a day after it raised its third-quarter order intake guidance.

After smooth gains in the past seven months, stock markets have faced volatility in September with investors nervous about major central banks withdrawing pandemic-era stimulus amid signs of higher inflation.

The benchmark STOXX 600 is on course to end September almost 3% lower, leaving it with marginal gains on the quarter.

“Rates are still low in a historical context, but a sharp sustained increase will unnerve markets if the economy is caught short of time to adapt to tighter credit conditions,” said Jim Smigiel, chief investment officer at SEI.

A recent surge in commodity prices, supply-chain constraints, the Evergrande debt crisis and a power crunch in China have all hurt global growth sentiment.

Data showed Spain’s inflation surged to a 13-year-high in September. The monthly reading of euro zone’s consumer confidence is due at 0900 GMT.

Among other individual stocks, British drugmaker AstraZeneca (NASDAQ:) gained 2.3% after saying it will take full control of Caelum Biosciences in a deal worth up to $500 million.

British clothing retailer Next climbed 2.5% to a record high after it raised its full-year profit outlook for the fourth time in six months.

Meanwhile, the oil & gas index slipped back from over one-year highs as a recent rally in crude prices petered out following an unexpected build in U.S. inventories. [O/R]

Royal Mail (LON:) Plc dropped 4.9% to the bottom of UK’s after UBS downgraded the stock to “sell” from “buy”.