Bond yields, Nvidia earnings in focus

Europe’s Stoxx 600 closed 0.37% lower Thursday as tech stocks dropped 2.3% and August gloom returned after three positive sessions.

The benchmark index has fallen 4.17% in the month to date, according to Eikon data.

The U.K.’s FTSE 100 eked out a 0.2% gain as Germany’s DAX fell 0.7% amid renewed concerns about the deterioration of business activity in the euro zone’s biggest economy.

Turkey’s central bank on Thursday hiked interest rates by more than expected to 25%, signaling it was willing to follow through on a new commitment to damp inflation through monetary policy.

The main policy rate was previously at 17.5%. Economists polled by Reuters expected a rise to 20%.

In a Thursday statement, the Turkish central bank committee said it “decided to continue the monetary tightening process in order to establish the disinflation course as soon as possible, to anchor inflation expectations, and to control the deterioration in pricing behavior.”

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– Jenni Reid

ALK-Abello shares were up more than 8% by early afternoon to lead the Stoxx 600 after the Danish allergy treatment company beat second-quarter earnings expectations and almost doubled year-on-year operating profits.

Elsewhere, Britain’s JD Sports added 4% while Swedish video game holding company Embracer Group dropped 4.5% to the bottom of the index.

– Elliot Smith

By early afternoon in London, the pan-European Stoxx 600 index had all but given back opening gains of 0.9%, hovering just 0.1% above the flatline. Financial services added 0.8% while mining stocks fell 0.7%.

Christian Mueller-Glissmann, head of asset allocation research at Goldman Sachs, explains why the Wall Street giant is neutral on stocks and bonds.

CNBC takes a look at the Nvidia numbers that boosted global stocks on Thursday.

ALK-Abello shares soared more than 11% in early trade to lead the Stoxx 600 after the Danish allergy treatment company beat second-quarter earnings expectations and almost doubled year-on-year operating profits.

Danish health care company Ambu also added more than 4%.

– Elliot Smith

The pan-European Stoxx 600 index was up 0.9% in early trade, with tech stocks climbing 1.9% to lead gains as all sectors and major bourses opened in positive territory.

Britain’s FTSE 100 is set to open around 38 points higher at 7,359, Germany’s DAX is seen up around 83 points to 15,811 and France’s CAC 40 is expected to add around 49 points to 7,296, according to IG data.

JPMorgan warned that rapid growth in artificial intelligence is no guarantee of sustained earnings expansion — and could leave many companies at risk.

The Wall Street bank said that the rise in companies using generative AI, the technology made popular by OpenAI’s ChatGPT, will boost productivity and deepen customer engagement.

But it cautioned that if the underlying AI technology is similar, the expansion of generative AI use could erode product differentiation and pricing power among currently competitive companies. It also noted that some companies are already anticipating deflationary pricing pressure.

It named two stocks that are particularly at risk. CNBC Pro subscribers can read more here.

— Ganesh Rao

Stocks in the sector are an option for investors seeking inflation protection, says one strategist, who names one with “plenty of room to grow.”

He says it’s “a far superior alternative” to Treasury Inflation-Protected Securities.

Fund managers and other investors name stocks to buy.

CNBC Pro subscribers can read more here.

— Weizhen Tan