Key Points

• European markets lifted by Nvidia: Strong earnings from Nvidia eased fears of slowing AI demand, lifting the STOXX 600 and boosting sentiment across European equities despite lingering concerns over China exposure.
• Tesla’s slump vs BYD’s surge: Tesla’s July sales in Europe fell 40% year-on-year, while Chinese rival BYD tripled registrations, underscoring intensifying competition in the region’s EV market.
• Asia markets mixed on policy cues: Asia-Pacific stocks traded mixed as the Bank of Korea held rates at 2.5% and India reopened to U.S. tariff pressures, while Japan and China advanced.
• Cambricon’s explosive growth: Chinese chipmaker Cambricon posted a 4,000% revenue jump and record profit, highlighting Beijing’s push for Nvidia alternatives amid U.S. export restrictions.

European Stocks Lifted by Nvidia Results and Earnings Boost

European equities gained on Thursday as Nvidia’s upbeat forecast tempered concerns of a slowdown in AI demand, though uncertainty over its China business kept sentiment cautious. The pan-European STOXX 600 rose 0.3% to 556.53, with semiconductor stocks trading mixed as ASML and BESI edged lower, while Infineon and ASM International added nearly 1% each.

Strong corporate earnings supported the broader market: Delivery Hero advanced 3.8% on better-than-expected revenue, while Pernod Ricard and Remy Cointreau posted solid gains after strong quarterly results. France’s CAC 40 rebounded 0.7% after steep losses earlier in the week tied to political instability.

Tesla Sales Slump as BYD Surges in Europe’s EV Market

Tesla’s European sales plunged 40% in July to 8,837 units, marking the automaker’s seventh straight monthly decline, while Chinese rival BYD posted a 225% surge with 13,503 new registrations, according to ACEA data. The drop comes despite overall growth in Europe’s battery electric vehicle market, underscoring Tesla’s mounting challenges from intensifying competition and brand headwinds linked to Elon Musk’s political ties.

Analysts cite Tesla’s aging lineup and lack of successful new models as key weaknesses, while BYD’s aggressive expansion and pricing strategy continue to win market share. Legacy European automakers such as Volkswagen, BMW, and Renault posted gains.

Asia-Pacific Markets Mixed as Korea Holds Rates, India Faces Tariff Pressures

Asia-Pacific equities ended mixed Thursday as the Bank of Korea left rates unchanged at 2.5%, in line with expectations, while investors weighed trade headwinds for the region. South Korea’s Kospi rose 0.29% and Japan’s Nikkei gained 0.73%, supported by resilient tech sentiment, while Hong Kong’s Hang Seng slipped 0.79%. Australia’s ASX 200 edged higher as Qantas reported record profits and Lynas Rare Earths announced a major capital raise.

India’s Nifty 50 retreated 0.49% as U.S. tariffs on Indian exports doubled to 50%, raising concerns over growth. Meanwhile, Wall Street notched fresh highs as Nvidia’s results steadied sentiment.

China’s Cambricon Soars on Explosive Revenue Growth as Nvidia Rivalry Heats Up

Chinese chipmaker Cambricon reported a staggering 4,000% jump in first-half revenue to 2.88 billion yuan ($403 million) and swung to a record 1.04 billion yuan profit, underscoring Beijing’s push to build domestic alternatives to Nvidia. Shares have more than doubled this year, adding over $40 billion to its market value as Chinese firms increasingly turn to local AI hardware amid U.S. export restrictions.

While Cambricon’s scale still pales compared with Nvidia’s $44 billion quarterly revenue, its rapid ascent highlights both opportunity and geopolitical risk as China accelerates efforts to reduce reliance on U.S. chip technology.

Conclusion

Nvidia’s earnings helped stabilize sentiment in Europe, while Tesla’s slump highlights how rapidly Chinese competitors are reshaping the EV landscape.

In Asia, central bank caution and U.S. trade tariffs underscore the fragility of regional growth, even as China’s domestic chipmakers like Cambricon surge on government support.

Global markets remain in a delicate balance, driven by divergent sectoral and geopolitical dynamics. Together, these developments reflect an environment where monetary policy signals, trade frictions, and technological rivalry continue to dominate investor focus. Positioning strategies will need to account for both heightened competition and ongoing policy-driven market shifts.

Investment Insights

• European Equities: Nvidia’s solid outlook helped stabilize AI sentiment, but the muted response underscores that valuations in semiconductors remain stretched; selective positioning in diversified tech and industrials may provide better balance.
• EV Sector: Tesla’s steep European sales decline against BYD’s surge highlights shifting market dynamics—investors should watch for further erosion of Western incumbents’ market share as Chinese automakers expand aggressively.
• Asia-Pacific Markets: Policy stability in South Korea and resilient earnings in Australia show regional resilience, but India’s vulnerability to U.S. tariffs underscores the need for geographic diversification in emerging market exposure.
• China Tech: Cambricon’s explosive revenue growth demonstrates Beijing’s determination to build domestic AI chip capacity, suggesting long-term support for local champions despite technological gaps with global leaders.

Economic Calendar