ASML Drops With Tech as Traders Suspect Opening ‘Fat Finger’

(Bloomberg) — ASML Holding NV shares dropped in the first minutes of trading before quickly recovering, with traders blaming the unexpected slump on an erroneous trade.

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According to multiple equity traders, a “fat finger” — trades made by human error, or even by algorithms — could have been behind an initial slump of as much as 7.1% in the stock. A spokeswoman for Euronext SA rejected that was to blame and said no alerts were triggered at the pan-European exchange this morning.

Europe’s most-valuable tech firm pared those losses, before turning lower again amid worries that stronger-than-expected US inflation could delay interest-rate cuts. The stock was down 5% in afternoon trading in Amsterdam.

“ASML started the day with what looked like a fat finger, but the rebound also drew out sellers as the EU tech sector runs into profit taking,” said Mark Taylor, a director at UK broker Panmure Gordon.

While generally not uncommon, fat fingers in high-profile stocks like ASML are rare. ASML shares went into a trading halt due to volatility just after the open, lasting three minutes.

In the first minute of the session, 28,558 shares traded between €858.20 and €815.60, with only 110 shares trading at the day’s lowest price before the stock was halted. It resumed trading at €853.40 after an auction.

Even with Tuesday’s decline, ASML is up 22% so far in 2024, giving it a market capitalization of €333 billion ($356 billion). The Stoxx 600 Technology Index, which has gained 9.6% year-to-date, is on track for its first decline in nine sessions after closing Monday at the highest level in more than 23 years. The index fell as much as 3.7% on Tuesday, making tech the worst-performing sector in Europe.

“I think the technology sector is just profit taking due to technicals indicating overbought territory today,” said Janet Mui, head of market analysis at RBC Brewin Dolphin.

While erroneous trades are sometimes canceled, there were no cancelations for ASML as of midday, data compiled by Bloomberg show.

–With assistance from Henry Ren, Allegra Catelli and Jan-Patrick Barnert.

(Updates with additional Euronext comment in second paragraph, US inflation data in third)