TLDR
- Nvidia reported quarterly revenue that more than doubled year-on-year, with fiscal 2028 growth guidance of ~70% vs Wall Street’s 44% estimate
- European chip stocks ASML, STMicroelectronics, Infineon, and BE Semiconductors rose 2-4% on the back of Nvidia’s results
- The pan-European Stoxx Europe 600 slipped 0.1%, with the FTSE 100 down 0.4% and France’s CAC 40 off 0.2%
- German consumer sentiment improved heading into September, rising to -26.6 points
- Brent crude dropped 0.5% to $87.40, its fourth consecutive daily decline, as Middle East peace talks eased supply fears
Nvidia’s latest earnings gave European chip stocks a lift on Thursday, though broader European markets stayed largely flat as investors weighed AI optimism against economic caution.
The Santa Clara-based chipmaker reported quarterly revenue that more than doubled compared to a year ago. It also guided for current-quarter revenue above Wall Street expectations and said it expects fiscal 2028 revenue growth of around 70%. Analysts had been forecasting 44%.
Nvidia shares jumped as much as 5.6% in after-hours trading. It was the stock’s first positive post-earnings reaction in several quarters.
European Chip Stocks Catch the Wave
The strong results fed through to European semiconductor names. ASML gained around 2.5%. STMicroelectronics, Infineon Technologies, and BE Semiconductors each rose between 2% and 4%.
These companies supply equipment and components used in chip manufacturing. As big tech companies accelerate spending on AI infrastructure, demand for their products is expected to grow.
Despite the chip sector gains, the wider market was cautious. The Stoxx Europe 600 edged 0.1% lower. Germany’s DAX was flat. France’s CAC 40 fell 0.2% and London’s FTSE 100 slipped 0.4%.
Stronger-than-expected US inflation data kept traders on edge. It reinforced expectations that the Federal Reserve could raise interest rates before the end of the year.
German Consumers Show Signs of Recovery
On the economic front, German consumer sentiment improved heading into September. The index from NIM and GfK rose to -26.6 points. Gains in income and economic expectations helped offset continued caution on spending.
The data suggests that private consumption in Germany could slowly recover as wage growth catches up with past inflation.
Investors were also watching for French PPI and unemployment data, as well as Eurozone credit activity figures. The European Central Bank’s Monetary Policy Meeting Accounts were set to be reviewed for clues on the rate outlook.
In corporate news, French spirits maker Pernod Ricard said it expects sales growth to come in at the lower end of its forecast range over the next few years. It cited ongoing weakness in its key US market.
Oil continued to slide. Brent crude fell 0.5% to $87.40 a barrel, marking a fourth straight day of losses. Reports that Qatar’s prime minister was traveling to Tehran to revive US-Iran diplomatic talks helped ease fears over supply disruptions through the Strait of Hormuz.
Euro Stoxx 50 futures were up 0.3% in premarket trade, pointing to a modestly positive open for European markets.
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