European Markets Open Higher as Nvidia Earnings Boost Sentiment; Drax Shares Plunge 11% on UK Probe

European stock markets opened higher on Thursday, lifted by strong earnings from U.S. tech giant Nvidia, even as investors weighed regulatory concerns around British renewable energy firm Drax. The pan-European Stoxx 600 index rose 0.25% in early trading, with France’s CAC 40 up 0.9%, Germany’s DAX gaining 0.39%, and Italy’s FTSE MIB climbing 0.53%.

Nvidia reported fiscal second-quarter revenue of $46.74 billion, slightly above analyst expectations, while projecting over 50% sales growth this quarter on the back of strong demand for artificial intelligence products. Despite the upbeat results, shares of the chipmaker slipped in after-hours trading due to weaker-than-expected data center revenue and concerns over future sales in China.

In corporate earnings, French drinks company Pernod Ricard reported a 3% annual decline in sales, citing weak consumer sentiment in China and U.S. tariff uncertainty. Despite the dip, its shares gained 5% in early trade as investors welcomed resilience in other markets. Meanwhile, shares of U.K.-based energy company Drax tumbled 11% after regulators launched a probe into its biomass sourcing disclosures between 2022 and 2024, raising questions about compliance with financial transparency rules.

The auto sector also provided momentum, with European Automobile Manufacturers Association (EAMA) data showing EU new car registrations rising 7.4% year-on-year in July. Battery-electric vehicle sales surged 39.1%, with Chinese EV-maker BYD leading growth at a remarkable 290.6% increase in registrations since January. In contrast, Tesla’s EU sales dropped 33.6% over the same period, highlighting shifting competition in the electric vehicle market.

Looking ahead, investors are awaiting fresh economic sentiment data from the European Union later on Thursday, followed by key inflation figures from France, Germany, Spain, and Italy on Friday. Market watchers say these data points could set the tone for the European Central Bank’s next monetary policy moves amid ongoing inflationary pressures.

Source: cnbc