Markets Hold Steady Amid AI Hype and Tesla Woes – Europe Market Wrap

US stock futures were steady as investors sifted through earnings reports, with Alphabet Inc. signaling strong demand for its AI products, while Tesla posted the biggest revenue decline in at least a decade.

Contracts on the S&P 500 were little changed and Nasdaq 100 futures rose 0.3% after Alphabet projected a $10 billion rise in its capital spending target to keep up in the AI race. The increase helped lift other AI infrastructure stocks in premarket trading, including chipmaker Nvidia Tesla slumped after CEO Elon Musk warned of difficult times ahead after losing electric vehicle incentives in the US.

As the earnings season picks up pace, investors are keen for reassurance that the record-breaking US rally can continue and that lofty valuations are justified. Europe’s stocks gauge was climbing on Thursday, following reports the US is closing in on an agreement with the European Union to set a 15% tariff for most products.

The Stoxx 600 index was trading up 0.4% on one of the busiest days in the earnings season in Europe, with Deutsche Bank AG shares jumping to the highest in a decade after the lender reported strong trading results. Meanwhile, BNP Paribas SA rose 3% after posting a better-than forecast profit. Luxury firm LVMH is due to report after the close.

Later Thursday, the European Central Bank is set to leave interest rates untouched for the first time in more than a year as it awaits clarity on the impact of President Donald Trump’s trade levies on inflation. Data showed the euro area’s private sector grew at the quickest pace since last August.

Delegations from the US and China are also due to hold negotiations in Stockholm next week for their third round of trade talks. Meanwhile, the US and South Korea have discussed creating a fund to invest in American projects as part of a trade pact, similar to an agreement Japan struck Tuesday, people familiar with the matter said.