Tech rebound lifts European shares after three-day slide

EUROPEAN shares gained for the first time this week on Thursday (Jul 9), as a rebound in technology stocks tempered lingering concerns about the war in the Middle East.

The pan-European Stoxx 600 index rose about 0.8 per cent to 640.88 points. Technology stocks and basic resources were the top gainers, up 2.7 per cent and 3.2 per cent, respectively.

“Despite a slump in business and consumer surveys since the start of the Iran war, economic activity seems to have held up quite well,” said Andrew Kenningham, chief Europe economist at Capital Economics.

The advance on Thursday followed three consecutive sessions of declines. Softer inflation and a drop in oil prices in the last few weeks had pushed the Stoxx 600 to a record on Monday, but a renewed wave of strikes between the US and Iran shattered the calm.

Markets will now shift their focus to the upcoming earnings season, which could draw some attention away from the geopolitical turmoil.

“Investors have also become a little more immune to developments (in the Middle East), viewing them as part of what has always been a choppy path towards a broader agreement,” said Fiona Cincotta, senior market analyst at City Index.

Chip majors gain, Spain rebounds

Computer chip stocks Siltronic, Soitec and ASML rose 13.4 per cent, 5.9 per cent and 4.8 per cent, respectively.

Global sentiment was buoyed by a report that said China could allow domestic AI firms limited access to AI leader Nvidia’s H200 chips, suggesting demand for AI infrastructure could get a boost.

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Spanish stocks outperformed the region, up 1.1 per cent from a three-week low on Wednesday, after US President Donald Trump said Spain was “very generous” after he threatened to halt trade with it.

Meanwhile, crude oil prices were 1.8 per cent lower, also aiding risk appetite.

Healthcare was the worst performing sector, down 1 per cent, led by a 6.2 per cent drop in AstraZeneca after the drugmaker’s nerve disease drug Wainua, made in partnership with US-based Ionis, failed to meet the main goal of reducing cardiovascular deaths and recurring heart problems in a late-stage trial.

IT services provider Computacenter jumped 7.2 per cent after saying it expects full-year results to exceed market expectations, helped by strong demand for AI-related infrastructure.

Onshore wind turbine manufacturer Nordex added 4.8 per cent after saying its project orders in the second quarter rose year-on-year to 3,054 gigawatts, boosted by significant orders from the US.

Investors are also weighing the interest rate trajectory for the European Central Bank, which raised borrowing costs last month.

The central bank’s policymakers were presented with projections showing inflation staying above target into next year despite nearly three rate hikes, accounts of the meeting showed on Thursday. REUTERS