European stocks steady as Nvidia outlook reinforces AI demand optimism: DAX, CAC, FTSE100

European equities traded close to the flatline on Thursday, holding near one-week highs as investors welcomed strong results and an upbeat artificial intelligence outlook from Nvidia Corp. (NASDAQ:NVDA) while maintaining a measured stance towards other parts of the market.

The pan-European Stoxx Europe 600 Index edged 0.1% lower. Germany’s DAX was broadly unchanged, while France’s CAC 40 slipped 0.2% and London’s FTSE 100 declined 0.4%.

The relatively subdued index moves contrasted with strong gains across European semiconductor stocks, where Nvidia’s latest guidance reinforced expectations that investment in AI infrastructure will remain a major growth driver.

Nvidia outlook strengthens confidence in AI growth

Nvidia reported quarterly revenue that more than doubled from the previous year, driven by continued strong demand for artificial intelligence computing hardware.

Chief executive Jensen Huang also reinforced expectations for further expansion, with the company providing current-quarter revenue guidance comfortably above Wall Street forecasts.

During its earnings call, Nvidia said it expects fiscal 2028 revenue growth of approximately 70%, substantially ahead of the consensus forecast of 44%.

Nvidia shares climbed as much as 5.6% in after-hours trading, delivering the company’s first positive immediate post-earnings share-price reaction in several quarters.

The results provided a significant boost to European companies exposed to semiconductor manufacturing and AI infrastructure investment.

ASML Holding NV (EU:ASML) gained 2.5%, while STMicroelectronics NV (BIT:STMMI), Infineon Technologies AG (TG:IFX) and BE Semiconductors (EU:BESI) advanced between 2% and 4%.

These companies are positioned to benefit as global technology hyperscalers continue increasing capital expenditure to secure the semiconductor equipment, components and computing infrastructure required for expanding AI workloads.

German consumer confidence shows improvement

Germany’s consumer sentiment indicator, produced jointly by the Nuremberg Institute for Market Decisions and market research group GfK, improved to -26.6 points heading into September.

The survey showed stronger economic and income expectations, which helped offset continued caution among households towards discretionary spending.

The improvement provides an encouraging signal for Europe’s largest economy, suggesting that private consumption could gradually strengthen as improvements in real wages help households recover purchasing power lost during the earlier period of elevated inflation.

Oil extends decline as Middle East diplomacy progresses

Brent crude declined 0.5% to $87.40 per barrel, putting the international benchmark on course for a fourth consecutive daily fall.

Oil prices came under further pressure following reports that Qatar’s prime minister is travelling to Tehran in an effort to restart diplomatic peace talks between the US and Iran.

At the same time, discussions between Iran and Oman regarding commercial transit through the Strait of Hormuz have helped ease immediate concerns about disruption to one of the world’s most important energy shipping routes.

The renewed diplomatic activity has reduced some of the geopolitical risk premium previously supporting crude prices, offering markets greater optimism that commercial shipping conditions could improve while negotiations continue.

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