European Stocks Surge Ahead of ECB Decision: What to Expect Next

Frankfurt, Germany – European stocks opened higher on Thursday as traders awaited the European Central Bank’s decision on the first interest rate cut since September 2019. The Stoxx 600 rose by 0.6% in early trading, with major bourses and sectors predominantly in the green. The U.K.’s FTSE index was expected to open 0.1% higher, Germany’s DAX up 0.5%, France’s CAC 40 up 0.4%, and Italy’s FTSE MIB up 0.4%.

In Australia, exports dropped by 2.5% in April compared to the previous year, marking the lowest level since 2021. The decline was driven by metal ores and minerals, while imports to Australia fell by 7.2%. Consequently, the country’s trade surplus for April increased to AU$6.55 billion, surpassing expectations.

Foxconn, a multinational electronic contract manufacturer, reported a 22% year-on-year revenue increase in May, reaching a record high of 550.16 billion new Taiwan dollars. Despite it being an off-peak season for the second quarter, Foxconn saw higher-than-expected demand from Al servers, leading to a positive outlook. Shares of Foxconn, trading as Hon Hai Precision Industry in Taiwan, rose by 2.56% on Thursday.

Meanwhile, SoftBank Group Corp’s shares surged by over 5% following news that activist investor Elliott Management had re-acquired a stake worth over $2 billion and was advocating for a $15 billion share buyback. In addition, Tempus AI, a healthcare technology company backed by SoftBank, aimed for a U.S. initial public offering with a valuation of up to $6.10 billion, according to SEC filings.

Nvidia experienced significant growth, prompting consideration about when to sell holdings in the midst of the stock’s rally. Financial experts suggested that rebalancing a portfolio by selling some highly appreciated positions and reinvesting those proceeds in other asset classes could help address any portfolio distortions.

Lastly, in extended trading, Lululemon Athletica shares surged by 9% after exceeding Wall Street’s estimates for the first quarter, while Five Below shares dropped by 15% due to disappointing guidance on second-quarter revenue. These movements in the market highlighted notable shifts after hours, showcasing the volatility and dynamics of the trading landscape.