EUROPEAN shares ended on Thursday on a strong note in a chipmaker-driven rally, further powered by the resumption of the US Federal Reserve’s policy-easing cycle, while SIG slumped after a profit warning.
The pan-European Stoxx 600 ended 0.8 per cent higher at 555.01 points, with the wider technology index leading gains by rising 4.1 per cent – its biggest single-day advance since April 23.
The sector was boosted by European semiconductor stocks, which soared in line with their Wall Street counterparts after chip bellwether Nvidia announced plans to invest US$5 billion in struggling peer Intel.
Europe’s BE Semiconductor surged 7.9 per cent, while equipment manufacturers ASML and ASMI jumped 7.7 per cent and 8.7 per cent, respectively.
Gains were also backed by the Fed’s overnight decision to cut interest rates by an expected quarter of a percentage point, the US central bank’s first dovish policy move since December.
The Fed projected further cuts at meetings in October and December, prioritising the need to stall further weakening in the labour market.
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“The fact we’ve had a normal-sized reduction and guidance would suggest that it’s a slow and steady path for monetary easing. And investors clearly like that because it doesn’t imply that there’s major worries,” said Daniel Coatsworth, investment analyst at AJ Bell.
Elsewhere in Europe, the Bank of England kept its main interest rate on hold at 4 per cent after last month’s quarter-percentage-point reduction. The UK’s benchmark FTSE 100 index was up 0.2 per cent.
Norway’s central bank followed the Fed’s path to deliver a quarter point cut, projecting a slower easing pace going forward.
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Also contributing to Stoxx 600 moves was the broader luxury sector, up 1.8 per cent, alongside an index of automakers, up 1.2 per cent.
Novo Nordisk surged 6.2 per cent as investors turned more positive about the Danish drugmaker’s prospects following a key diabetes conference held in Vienna this week.
However, SIG Group slid 24.3 per cent after the Swiss packaging group issued a profit warning for 2025 and suspended its cash dividend.
Continental plunged 21.9 per cent as the tire maker spun off Aumovio, which made its debut on the Frankfurt Stock Exchange with a total market value of about 3.5 billion euros (S$5.3 billion).
Aena fell 4.7 per cent after the Spanish airport operator announced plans to invest 12.88 billion euros (S$19.5 billion) to upgrade its terminals from 2027 to 2031.
Political jitters in France also persisted after the country was rattled by anti-austerity protests on Thursday, with protestors urging President Emmanuel Macron and his new Prime Minister Sebastien Lecornu to scrap proposed budget cuts. REUTERS
