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23/05/24
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STOXX 600 European Index Closes Flat
On Thursday, stocks in Europe closed flat as indications of improving economic activity led to investors scaling back expectations for interest rate cuts this year and weighed on optimism around strong forecasts from Nvidia.
The STOXX 600 pan-European index dropped from session highs to close virtually unchanged.
The tech index was 1.1% higher, with semiconductor stocks including ASM, Infineon, and ASML up in the range of between 1% and 2.6% after Nvidia forecasted quarterly revenue of higher than estimates, increased its quarterly dividend by 150%, and announced a stock split.
Morningstar’s senior investment consultant and portfolio manager, Mark Preskett, said those were key players in the semiconductor equipment and production cycle and it seemed like the shovels-and-picks approach of investing was bearing fruit.
The STOXX index has since late 2023 been boosted by hopes of imminent interest rate cuts by the ECB and a surge in technology stocks around the prospects for AI, and it is trading slightly below its all-time high.
Risky assets were however under pressure as European bonds’ yields increased after a preliminary survey showed eurozone business activity in May expanded at the fastest pace in a year.
Negotiated pay growth rose slightly in Q1, boosting the case for caution in reducing interest rates from record highs.
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