European stocks lifted by Nvidia’s blowout results


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European stocks followed Asia higher on Thursday, as blowout revenues from chipmaker Nvidia fuelled investor enthusiasm for artificial intelligence stocks. 

Europe’s region-wide Stoxx Europe 600 rose 0.9 per cent at the market open, buoyed by a strong technology sector, while France’s Cac 40 added 0.8 per cent and Germany’s Dax gained 1 per cent. 

The Stoxx Europe 600 Technology index jumped 1.8 per cent, as the rally in tech stocks reverberated across global stock markets, a day after US chip company Nvidia reported revenues that more than doubled in the latest quarter, outstripping even the heightened estimates on Wall Street. 

Optimism about artificial intelligence has driven much of the rally in megacap US tech stocks since the start of the year, helping Nvidia shares triple and making it the first ever chip business to have a $1tn market capitalisation. The company gained 6.6 per cent in after-hours trading. 

“This eagerly anticipated report was a lot more than just about Nvidia’s earnings,” said James Baxter, founder of Tideway Wealth. “It is being read as an insight into the impact of generative AI, where Nvidia technology leads the way, on the wider software and computing industry.”

Shares of Dutch chipmaker ASML gained 1.6 per cent, the Switzerland-based STMicroelectronics advanced 1.3 per cent and South Korea’s SK Hynix gained 4.2 per cent, as Nvidia results confirmed traders’ bets on growing demand for chips used in generative AI systems. 

In Asia, Hong Kong’s Hang Seng index rose 2 per cent, China’s CSI 300 added 0.7 per cent, Japan’s Topix increased 0.4 per cent and South Korea’s Kospi gained 1.3 per cent. 

Futures contracts tracking Wall Street’s tech-focused Nasdaq 100 rose 1.2 per cent, while those tracking the benchmark S&P 500 gained 0.6 per cent ahead of the New York opening. 

Equities were already edging higher before Nvidia results boosted market sentiment, as purchasing managers’ index data from the US and Europe on Wednesday increased the chances that big central banks would soon stop raising interest rates. 

Jefferies’ chief Europe financial economist Mohit Kumar noted that the PMI surveys could foreshadow an upcoming deterioration of hard data, which had until now been particularly strong in the US.

“The PMI data supports our view that we should see the macro picture (and labour data) start to crack towards the end of the third quarter, early fourth quarter,” he said. 

Yields on two-year German Bunds, which are sensitive to rate expectations, slipped 0.03 percentage points to 2.94 per cent, while yields on 10-year Bunds, a regional benchmark, fell 0.05 percentage points to 2.47 per cent. Bond yields fall as prices rise. 

Investors will be focused on the annual economic policy conference in Jackson Hole, Wyoming, where US Federal Reserve chair Jay Powell is on Friday expected to offer an indication of the central bank’s plans for future rates.

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Lisa Holden
Lisa Holden
Lisa Holden is a news writer for LinkDaddy News. She writes health, sport, tech, and more. Some of her favorite topics include the latest trends in fitness and wellness, the best ways to use technology to improve your life, and the latest developments in medical research.

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