Volkswacht Bodensee - Stocks drop, oil steadies tracking tech sell-off, Mideast unrest

Asian and European equity indices failed to build on Wall Street's gains Wednesday.

"Fragile sentiment is leading to a continued pullback in memory chip stocks after their gravity-defying run as investors fret about elevated valuations," noted Dan Coatsworth, head of markets at AJ Bell trading group.

He added that the price of Brent North Sea crude, the international benchmark, stayed "near one-month highs as tensions continue to mount in the Middle East".

In stock markets trading, Seoul's Kospi dived more than six percent as chip titan SK hynix shed more than 11 percent amid growing anxiety that the AI rally -- which had pushed both firms to record highs this year -- has run its course.

Traders are questioning whether the vast sums pumped into the artificial intelligence sector in recent years can vindicate the eye-watering valuations for some firms.

Taiwanese chipmaker TSMC on Thursday announced net profit soared more than 77 percent to a record high in the second quarter thanks to massive demand for AI hardware.

It said it would invest an additional $100 billion in the US state of Arizona.

While investors remain confident in the outlook for the AI sector, analysts said the trade had become too crowded.

Still, Hong Kong's stock market gained more than one percent Thursday as Chinese chip firms advanced.

And all three main indices in New York ended higher Wednesday thanks to hefty gains in tech giants including Apple, Amazon and Facebook parent Meta.

That came as figures showed US producer prices slipped 0.3 percent month-on-month in June thanks to lower energy prices as the United States and Iran reached a truce to reopen the Strait of Hormuz and allow crude to pass through again.

The readings soothed market worries that the Federal Reserve would hike borrowing costs this month, though analysts warned that the renewed US-Iran hostilities, which have seen them trade strikes for around a week, could undo the good work.

On the corporate front Thursday, German food delivery group Delivery Hero said it had agreed to be taken over by US ride-hailing giant Uber in a 12.7-billion-euro ($14.6-billion) deal.

Delivery Hero's shares rose 1.4 percent in Frankfurt after the announcement.

- Key figures around 1030 GMT -

Brent North Sea Crude: DOWN 0.3 percent at $84.71 a barrel

West Texas Intermediate: FLAT at $79.60 a barrel

London - FTSE 100: DOWN 0.2 percent at 10,492.63 points

Paris - CAC 40: DOWN 0.6 percent at 8,328.38

Frankfurt - DAX: DOWN 0.6 percent at 24,841.48

Tokyo - Nikkei 225: DOWN 2.8 percent at 66,835.54 (close)

Seoul - Kospi: DOWN 6.4 percent at 6,820.60 (close)

Hong Kong - Hang Seng Index: UP 1.3 percent at 25,008.60 (close)

Shanghai - Composite: DOWN 1.9 percent at 3,882.41 (close)

Euro/dollar: UP at $1.1465 from $1.1463 on Wednesday

Pound/dollar: DOWN at $1.3504 from $1.3530

Dollar/yen: DOWN at 162.16 yen from 162.27 yen

Euro/pound: UP at 84.89 pence from 84.72 pence

P.Vogel--VB