European stock markets edged higher on Thursday (14 May) as technology shares boosted sentiment, although investors remained cautious over stalled U.S.-Iran talks and a closely watched summit between Washington and Beijing.
The pan-European STOXX 600 index rose 0.4 per cent to 613.98 points by mid-morning trading, building on Wednesday’s 0.8 per cent gain. Germany’s DAX climbed 1.2 per cent, while Britain’s FTSE 100 was broadly flat despite stronger-than-expected economic data showing the UK economy expanded by 0.3 per cent in March.
Trading activity remained subdued, with several European markets closed for public holidays.
Markets are balancing optimism around artificial intelligence with fears of wider instability in the Middle East. U.S. President Donald Trump is expected to press China to help end the Iran conflict after negotiations between Tehran and Washington stalled.
“We await the developments in China. But really the focus is on AI,” said Frédérique Carrier, head of investment strategy at RBC Wealth Management. “All eyes are on the Middle East crisis for that to really be resolved.”
Technology stocks were among the strongest performers. Europe’s technology index gained 1 per cent, helped by semiconductor companies including STMicroelectronics, ASM International, BE Semiconductor Industries and Infineon Technologies, which rose between 1.4 per cent and 2.8 per cent.
The rally reflects growing confidence that companies linked to AI and data centres will continue to benefit from heavy investment. However, European shares remain below the levels seen before the outbreak of the Iran conflict, while U.S. markets have already returned to record highs.
Carrier said Europe’s earnings season had been solid, particularly for banks and industrial firms linked to electrification and data centres, although it “pales in comparison” with the stronger performance seen in the United States.
Among individual companies, Burberry fell 4.7 per cent after reporting fourth-quarter sales in line with expectations. Watches of Switzerland jumped 14 per cent after forecasting full-year operating profit above market expectations.
Investment group 3i Group dropped almost 16 per cent following its results, dragging the financial services sector down 0.8 per cent.
Meanwhile, Legal & General rose 5.2 per cent after the Financial Times reported that the company was not considering a sale.
Investors are also reassessing the outlook for interest rates after European Central Bank chief economist Philip Lane signalled that further rate rises may be needed to tackle inflation.
Money markets are now pricing in more than two ECB rate increases this year, with the first expected in June.
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The United States has moved to close a regulatory gap that may have allowed advanced AI chips to reach Chinese-linked firms overseas despite export restrictions.
Donald Trump said he is “in no hurry” to reach a deal with Iran, insisting the U.S. is slowly getting what it wants. He warned military action remains an option if talks fail. Meanwhile, U.S. forces said they fired a missile at a vessel trying to breach Washington’s blockade of Iran.
Nicaraguan indigenous leader and former lawmaker Brooklyn Rivera has died in state custody at the age of 73, according to local media reports citing his family.
U.S. rapper Kanye West, now known as Ye, performed to a crowd of 118,000 people in Istanbul on Saturday night, marking his first concert in Europe in more than a decade, despite being barred from performing in several countries over past antisemitic remarks.
Iranian-made Yassin missiles were spotted mounted on Armenian Air Force fighter aircraft during Armenia's latest military parade on Thursday (28 May), drawing attention from defence observers and regional analysts.
The Philippines remains under a "severe threat" from China despite recent efforts by Washington and Beijing to ease tensions, Philippine Defence Secretary Gilberto Teodoro said on Saturday (30 May).
Thai rescuers say five people have been pulled alive from a flooded cave in remote Laos, where seven villagers became trapped after heavy rain cut off access underground.
Russia has recalled its ambassador to Armenia for consultations, citing Yerevan's growing rapprochement with the European Union. The move is seen as the latest sign of deteriorating relations between the longtime allies ahead of Armenia's parliamentary election on 7 June.
Ukrainian drones struck targets across several Russian regions overnight, including an oil pipeline pumping station, a refinery and a fuel depot, Russian and Ukrainian authorities said on Sunday.
Start your day informed with the AnewZ Morning Brief. Here are the top stories for 1 June, covering the latest developments you need to know.
The United States has moved to close a regulatory gap that may have allowed advanced AI chips to reach Chinese-linked firms overseas despite export restrictions.
Colombian right-wing outsider Abelardo De La Espriella is set to face leftist senator Iván Cepeda in a presidential runoff, according to Colombia’s National Registry Office data released on Sunday.
Malta’s Prime Minister Robert Abela has secured a fourth successive election victory for his Labour Party, extending its hold on power, though with a reduced majority compared with previous polls.
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