European shares join a global sell-off as AI spending fears rattle Wall Street and Asian markets

European shares have fallen after sharp losses in Asia and on Wall Street. Doubts over huge AI investments and fears of curbs following the Democrats' US midterm victory have rattled global markets. European shares fell sharply in early trading on Friday as a global sell-off fueled by concerns over artificial intelligence stocks spread from Wall Street to Asia and Europe.

Fears of curbs on AI data-center spending have added to investors' concerns after Democrats won control of both chambers of the US Congress. The pan-European STOXX 600 index dropped 1.6% in early trading, wiping out its gains for the week. Most major European markets fell more than 1%, with media, healthcare and retail stocks leading the declines.

European markets had previously weathered the week's turbulence better than their Asian and US counterparts because of their more limited exposure to AI stocks. Earlier, Japanese and South Korean shares tumbled after a massive selloff in tech stocks on Wall Street the previous day.