MARKET REPORT: £130bn wiped off Nvidia as chipmakers crumble

Hundreds of billions of pounds were wiped off the value of global chipmakers yesterday after a shock warning from one of the world’s biggest players.

Dutch giant ASML, Europe’s biggest tech firm and a leading supplier of equipment used to manufacture chips, forecast lower than expected sales in 2025.

The business noted that while demand for artificial intelligence technology remained strong, other parts of the semiconductor market are proving weaker for longer than feared.

Shares in ASML plunged more than 15 per cent in Amsterdam – wiping £34billion off its value.

Chip shock: Nvidia, the world’s second most valuable company behind Apple, saw its value reduced by £130bn as its shares fell around 5%

The warning sent shockwaves through the industry and Nvidia, the world’s second most valuable company behind Apple, saw its value reduced by £130billion as its shares fell around 5 per cent.

Cambridge-based Arm, which like Nvidia is listed in New York, took an £8billion hit as its shares dropped almost 6 per cent.

Oil stocks also took a beating as the price of crude fell. BP shares fell 3.9 per cent, or 15.9p, to 392.5p and arch-rival Shell slid 3.4 per cent, or 87p, to 2502.5p. 

That reduced the value of BP by £2.6billion and Shell by £5.4billion – a total of £8billion in just one session.

Commodities trader Glencore was also on the slide, down 4 per cent, or 17p, to 403.55p.

The sell-off came as Brent crude fell more than 2 per cent towards $73 a barrel – meaning it has fallen around 9 per cent since peaking above $80 last week as conflict escalated in the Middle East.

The latest fall was triggered by reports that Israel was not planning to target Iranian oil and nuclear installations, easing tensions across the region. 

The slide in the oil price was good for airlines, however, on hopes that it will drive down the cost of jet fuel.

British Airways owner IAG gained 4,1 per cent, or 8.15p, to 206.9p, Easyjet added 3.2 per cent, or 15.8p, to 518p and Wizz Air rose by 1.5 per cent, or 18p, to 1256p.

The FTSE 100 lost 0.5 per cent, or 43.38 points, to 8249.28 and the FTSE 250 slipped 0.1 per cent, or 22.75 points, to 20,794.44.

Housebuilders were on the rise on hopes that the Bank of England will cut interest rates next month and possibly again in December. 

Official figures showed average weekly earnings excluding bonuses were 4.9 per cent higher than a year earlier in the three months to the end of August.

That was the smallest increase in more than two years and fuelled hopes the Bank will follow up August’s rate cut with another move in November.

Barratt Redrow grew by 2.8 per cent, or 12.8p, to 472p, Persimmon advanced 3.8 per cent, or 61p, to 1662p and Taylor Wimpey progressed by 2.2 per cent, or 3.4p, to 160.15p.

NatWest shares ticked up 0.6 per cent, or 2p, to 355p after analysts at Jefferies upgraded the stock. But they downgraded buy-to-let lender Paragon, which fell 4 per cent, or 30.5p, to 740p.

Money transfer firm Wise said it had 8.9m active customers at the end of its second quarter, up 23 per cent on a year earlier. 

It also reported a 17 per cent rise in underlying income to £337million. Shares gained 2,1 per cent, or 14.5p, to 693p.