European Stocks Drop, With Tech Shares Under Pressure

European Stocks Drop, With Tech Shares Under Pressure

European Stocks Drop, With Tech Shares Under Pressure

The FINANCIAL -- European stocks fell Wednesday, as sentiment across equity markets worldwide was soured by a round of disappointing corporate earnings.

The Stoxx Europe 600 fell 0.4% to 401.00, led by a more than 1% drop in technology shares, according to Nasdaq.

Tech woes: Lackluster financial updates from Apple Inc. (AAPL), Microsoft Corp. (MSFT), IBM (IBM) and United Technologies Corp. (UTX) in the U.S. on Tuesday drove U.S. markets sharply lower and selling pressure poured over into Asian markets overnight.

"Having been perceived as an indication of the global economic slowdown, lower-than-expected [Apple] iPhone shipments and underwhelmed sales forecasts for Q4 increased anxiety that ... U.S. earnings may remain gloomy for some time, especially with 21% contraction in overall Chinese sales," said Lewis Sturdy, sales trader at London Capital Group, in a note.

Shares of ARM Holdings PLC (ARMH) fell 3.5% in London, with the chip designer hurt after its client, Apple, issued a lackluster sales outlook. ARM shares weighed on the U.K.'sFTSE 100 , with the benchmark falling 0.8% to 6,708.19.

Germany's Dialog Semiconductor (DLG.XE), another Apple supplier, also saw shares drop, by 5.7%.

Even if lower Apple product sales "do not straightforwardly signify that the world economy is collapsing (in fact, it might well do so), it clearly means that the investor sentiment got a serious hit," said Sturdy.

On the country indexes, Germany's DAX shed 0.3% to 11,567.21 and France's CAC 40 lost 0.2% to 5,094.37.

Greece: The country's parliament is set to vote Wednesday on a second set of austerity measures demanded by the country's lenders. Formal negotiations on a third bailout program for Greece can only start once the measures have legislative approval. Athens is hoping those discussions can be finished by Aug. 20