May 23 2024: European stocks edged higher on Thursday, buoyed by strong forecasts from AI leader Nvidia, which lifted global chipmakers. Investors were also keenly awaiting business surveys to assess the euro zone economy’s outlook and potential interest rate changes.
Market Performance
The pan-European STOXX 600 index rose 0.2% as of 0711 GMT, with the tech index leading sectoral gains with a 1.2% increase. Shares of European semiconductor stocks, including ASML, Infineon, and ASM, climbed between 1.5% and 2.4%. This surge followed Nvidia’s impressive forecast for quarterly revenue, a stock split announcement, and a 150% increase in its quarterly dividend on a post-split basis. Nvidia’s shares rose 6.5% in Frankfurt trading.
Business Surveys and Economic Indicators
Investors are anticipating flash business surveys for the euro zone and the UK, which are expected to show slight improvements in May. These surveys are crucial for gauging the economic outlook and determining the interest rate trajectory in the region.
Sectoral Movements
Defensive sectors such as utilities and real estate were underperforming. Britain’s National Grid tumbled nearly 8% following its announcement of plans to raise about 7 billion pounds ($8.9 billion) through a fully underwritten rights issue.
The UK’s FTSE 100 remained broadly flat after Prime Minister Rishi Sunak called a general election for July 4.
Individual Stock Movements
Embracer: Shares of the Swedish games developer slid 7.2% after it announced the finance chief’s resignation for personal reasons and reported a fourth-quarter operating profit in line with market expectations.
The positive sentiment around Nvidia and the anticipation of business surveys have provided a lift to European markets, particularly benefiting the technology and semiconductor sectors.
