Critical chip firm ASML posts quarterly bookings surge on heated AI demand
Dutch semiconductor giant ASML on Wednesday reported a big jump in fourth-quarter net bookings, suggesting strong demand for its advanced chipmaking tools even as DeepSeek’s low-cost model raises concerns over AI spending.
Here’s how ASML did versus LSEG consensus estimates for the fourth quarter:
- Net sales: 9.26 billion euros versus 9.07 billion euros expected.
- Net profit: 2.69 billion euros versus 2.64 billion euros expected.
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— Ryan Browne
Broad indexes would suffer in 2025 if tech falters, but average stock hold up, Capital Economics says
Broad stock market indexes would suffer in 2025 if Big Tech leaders continue to falter but the average stock is likely to “hold up well,” according to Capital Economics senior markets economist James Reilly.
Although the S&P 500 Information Technology Index slid 5.5% Monday, its largest one-day decline since 2020, “the losses were largely confined to firms that had been expected to play a key role in facilitating AI, including semiconductor firms and utilities firms powering data centers,” London-based Capital Economics said, noting the S&P 500 only fell 1.5% and roughly 70% of companies in the index rose.
One possibility is that investors will start to favor more of the users of artificial intelligence and fewer of the “enablers,” which may have already begun before Monday, Reilly wrote. “In this scenario, the S&P 500 could rally further even as sentiment towards these prior favorites cooled. Indeed, something similar happened during the dotcom bubble — there was a rotation within the I.T. sector (from the largest firms) around 1999/2000 that didn’t undermine the S&P 500 index.”
Strangely, the large share of the market accounted for by the 10 biggest stocks offers some hope. “That might mean that the losses as these gains unwound would be similarly concentrated, affording plenty of scope for the average firm in the S&P 500 to do well if the economic backdrop stayed positive, as we expect,” Reilly noted.
— Scott Schnipper
European markets: Here are the opening calls
European markets are expected to open in mixed territory Wednesday.
The U.K.’s FTSE 100 index is expected to open 1 point higher at 8,538, Germany’s DAX up 46 points at 21,490, France’s CAC down 16 points at 7,897 and Italy’s FTSE MIB up 74 points at 36,406, according to data from IG.
Earnings come from ASML, Volvo, WH Smith and AkzoNobel and Sweden’s Riksbank publishes its latest monetary policy decision later this morning.
— Holly Ellyatt