European markets are poised for a positive open on Thursday, fueled by the better-than-expected quarterly earnings report from tech giant Nvidia. The chipmaker, a key supplier to industry leaders like Microsoft, Google, Meta, and Amazon, announced a fiscal second-quarter revenue of $46.74 billion, slightly exceeding forecasts. This strong performance reflects the ongoing strength of the artificial intelligence boom, with Nvidia projecting sales growth to remain above 50% for the current quarter.
However, the positive news wasn’t entirely unblemished. Nvidia’s stock experienced a slight dip in after-hours trading. This downturn stemmed from data center revenue falling short of expectations and growing concerns regarding future sales in the Chinese market. The market’s reaction highlights the delicate balance between positive overall results and specific sector underperformance.
Beyond Nvidia’s impact, other economic indicators are also influencing the European market outlook. French spirits giant Pernod Ricard reported a 3% decline in full-year sales, attributed to weak consumer sentiment in China and tariff uncertainties in the U.S. This illustrates the global interconnectedness of markets and the challenges companies face navigating international economic headwinds.
In contrast, the automotive sector shows signs of growth. The European Automobile Manufacturers Association reported a 7.4% year-on-year increase in new car registrations in July, with a particularly impressive 39.1% surge in battery-electric vehicles. This positive trend is significantly driven by Chinese EV maker BYD, whose registrations increased by 290.6% year-to-date. Interestingly, Tesla’s European registrations, however, experienced a 33.6% decline during the same period, highlighting the dynamic competition within the electric vehicle market.
Further economic data is anticipated later this week. EU consumer and economic sentiment figures are scheduled for release on Thursday, followed by inflation data from France, Germany, Spain, and Italy on Friday. This influx of information will likely shape the continued trajectory of European markets, adding another layer of complexity to the already interesting situation sparked by Nvidia’s earnings report.
