European stock markets moved higher on Thursday, led by a strong rally in technology shares after upbeat forecasts from U.S. chipmakers Micron and Qualcomm renewed investor confidence in the artificial intelligence sector. Falling oil prices also provided additional support to equities across the region.
The pan-European STOXX 600 index rose 0.46% to 638.11 points, with technology companies leading the gains as investors welcomed strong demand forecasts from major semiconductor firms.
Micron and Qualcomm delivered optimistic outlooks that helped ease growing concerns that AI-related stocks had become overvalued after several years of rapid gains. The positive guidance boosted sentiment across global semiconductor markets and sparked gains in European technology shares.
Europe’s technology sector, which has already gained more than 32% during the quarter, advanced another 2.4%. Semiconductor companies posted some of the strongest performances, with Infineon Technologies climbing 5.6% and STMicroelectronics rising 4.2%.
Semiconductor equipment makers also benefited from the renewed optimism. BE Semiconductor Industries gained 5.1%, while ASML advanced 4.5% as investors increased exposure to companies linked to the global AI supply chain.
Siemens Energy, which supplies equipment for AI-related power infrastructure and data centers, rose 1.5%. Investors continue to focus on companies expected to benefit from the expansion of data centers and digital infrastructure across Europe.
Market participants believe that although Europe lacks the large technology giants seen in the United States, several European companies occupy critical positions within the semiconductor, equipment, and infrastructure supply chains supporting artificial intelligence growth.
At the same time, declining oil prices helped improve market sentiment. Oil prices continued to fall as shipping activity normalized around the Strait of Hormuz, easing concerns about energy costs and inflation pressures.
Investors are also monitoring the impact of higher costs associated with the recent Middle East conflict on corporate earnings and consumer spending.
Among individual companies, Swedish fashion retailer H&M fell 2.1% after reporting second-quarter operating profit below analyst expectations, raising concerns about weak consumer demand. The broader European retail sector posted modest gains despite the decline.
British low-cost airline easyJet rose 6.3% after rejecting a fourth takeover proposal from U.S. investment firm Castlelake, while German automaker Volkswagen gained 1.5% after agreeing to sell its diesel engine business Everllence to Bain Capital in a transaction valued at approximately €7.4 billion.
Investors are also watching monetary policy expectations closely. Money markets continue to price in another 25-basis-point interest rate increase from the European Central Bank before the end of the year.
Attention now turns to the upcoming U.S. inflation data, which could influence the outlook for Federal Reserve policy and broader global market sentiment.
For now, strong AI demand, improving technology earnings expectations, and easing energy prices are helping support European equities, with technology stocks once again emerging as the market’s primary driver.
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