Volkswacht Bodensee - Stocks recover from tech tremors as oil prices fall

Despite an attack on a vessel in the Strait of Hormuz on Thursday, concerns quickly eased, with international benchmark oil contract Brent crude briefly dropping more than five percent.

The cargo ship, reported by US media to have been hit by Iran, resumed its transit through the strait with the crew, vessel and cargo "unharmed", according to Taiwanese shipping operator Evergreen Marine.

"The attack has rattled the fragile confidence of shipowners and crews, though ships continued to transit through the narrow corridor on Friday," said DNB Carnegie analysts.

Patrick Munnelly at Tickmill Group said normally such an incident would send crude oil prices higher.

"The market's reaction suggests investors are treating the incident as a security risk rather than a durable supply shock, at least for now, " he said.

Stock markets started off the day on the back foot as tech stocks came under renewed pressure after Apple announced price hikes on laptops, tablets and other products, citing spiralling memory and storage costs sparked by the rise of AI.

That was followed by Microsoft announcing price hikes for its popular Xbox gaming consoles, also citing an AI-fuelled surge in component costs.

Sharp losses hit across Asian markets, with South Korea's Kospi closed down almost six percent, a rout that sparked a 20-minute trading halt.

Shares in chip giant and market heavyweight SK hynix fell more than eight percent.

Tokyo, also heavy with tech firms, fell more than four percent, with tech investment giant SoftBank plunging over 12 percent as The New York Times reported that ChatGPT-maker OpenAI is considering holding off on an initial public share offering.

"News that OpenAI would delay its IPO until next year, over fears it would not attract enough interest to give it a $1 trillion listing, has also weighed on the market mood on Friday," said Kathleen Brooks, research director at XTB trading group.

- Tech doubts -

The tech sector -- in particular the so-called Magnificent Seven companies that includes AI chip designer NVIDIA, Apple, and Google's parent company Alphabet -- has been the main driver of a surge to record highs across several markets globally amid an eye-watering boom in all things AI.

That euphoria may be waning on worries that company valuations look stretched, amid questions about when firms will see a return on the trillions of dollars that have been invested.

Forex.com analyst Fawad Razaqzada said that while some degree of profit-taking was probably inevitable after the tech stock rally, "the latest moves also raise broader questions about whether expectations for the sector have simply run too far ahead of commercial reality."

Wall Street opened lower, with the tech-heavy Nasdaq Composite index falling more than one percent.

But the three main indices pushed into positive territory during the morning session in New York.

"Dip buyers have come storming in... to steady the ship after the wave of selling of the last 18 hours," said Chris Beauchamp, chief market analyst at online trading and investing platform IG.

"The recovery is a testament to the staying power of this rally, but holding on to gains has proved problematic throughout the week," he added.

- Key figures around 1530 GMT -

New York - Dow: UP 0.3 percent at 52,094.07 points

New York - S&P 500: UP 0.3 percent at 7,379.22

New York - Nasdaq Composite: UP 0.3 percent at 25,423.40

London - FTSE 100: DOWN 0.2 percent at 10,508.02 (close)

Paris - CAC 40: DOWN 0.6 percent at 8,384.87 (close)

Frankfurt - DAX: DOWN 1.3 percent at 24,671.22 (close)

Seoul - Kospi: DOWN 5.8 percent at 8,411.21 (close)

Tokyo - Nikkei 225: DOWN 4.2 percent at 69,360.88 (close)

Hong Kong - Hang Seng Index: DOWN 1.8 percent at 22,671.86 (close)

Shanghai - Composite: DOWN 2.3 percent at 4,027.26 (close)

Euro/dollar: UP at $1.1406 from $1.1374 on Thursday

Pound/dollar: UP at $1.3217 from $1.3199

Dollar/yen: DOWN at 161.66 yen from 161.81 yen

Euro/pound: UP at 86.32 pence from 86.18 pence

West Texas Intermediate: DOWN 4.5 percent at $68.71 a barrel

Brent North Sea Crude: DOWN 4.5 percent at $72.07 a barrel

T.Suter--VB