European stock markets edged higher on Thursday, driven by a strong recovery in technology shares, as investors balanced renewed optimism over artificial intelligence with ongoing uncertainty surrounding tensions in the Middle East.
The pan-European STOXX 600 index gained 0.5% to 639.12 points in early trading. Technology stocks led the advance, climbing 1.8%, while basic resources rose 2.8%.
Semiconductor-related companies posted notable gains, with Siltronic surging 10.5%, Soitec advancing 4.5%, and ASML adding 2.6%. The rebound followed a brief pullback after the sector recorded its strongest quarterly performance since 2001 in June. Despite being the weakest-performing sector so far this month, investors appeared willing to set aside concerns over high valuations.
Market sentiment also improved following reports that China may permit domestic artificial intelligence companies limited access to Nvidia’s H200 chips, raising expectations of stronger global demand for AI infrastructure.
Oil prices slipped slightly as traders assessed the latest developments in the Middle East. Investor attention remained focused on U.S. President Donald Trump’s remarks that Iran wanted to “make a deal,” despite the United States launching new strikes on Iran after Trump declared negotiations with Tehran were over a day earlier. The geopolitical uncertainty had pushed the STOXX 600 to its largest one-day decline since March.
Fiona Cincotta, senior market analyst at City Index, said positive AI-related developments were supporting investor confidence, while markets had become somewhat more accustomed to fluctuations in U.S.-Iran relations, viewing them as part of an uncertain path toward a broader agreement.
Spain’s benchmark index outperformed regional peers, rising 1.1% after recovering from a three-week low. The rebound followed Trump’s comments describing Spain as “very generous” after previously ordering a halt to trade with the country over its NATO spending commitments.
Healthcare stocks lagged the broader market, falling 1.5%. AstraZeneca tumbled 9.1% after announcing that its nerve disease treatment Wainua, developed with U.S.-based Ionis, failed to achieve the primary goal of reducing cardiovascular deaths and recurring heart complications in a late-stage clinical trial.
Among individual movers, IT services company Computacenter surged 11.1% after forecasting full-year earnings above market expectations, supported by robust demand for AI infrastructure projects.
Wind turbine manufacturer Nordex also gained 5% after reporting second-quarter project orders of 3,054 megawatts, driven by strong demand from the United States.
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