STOXX 600 Hits Record 655.2: How an AI-Fueled Tech Rally and Strong European Earnings Drove European Stocks to an All-Time High on July 31, 2026

The optimism cascaded to Asia, with South Korea's KOSPI index soaring nearly 18% in its largest single-day gain on record, led by semiconductor giants SK Hynix (up ~30%) and Samsung Electronics (up 27%) . European markets then opened sharply higher, tracking this global wave .

European Tech Stocks Jump 2.2%, Led by Semiconductor Names

European technology shares on the STOXX 600 jumped 2.2% on the day, with semiconductor stocks leading the charge . The key movers were:

• ASML climbed 2.8–3.4%, building on momentum from previously raising its full-year guidance to €43–45 billion, driven by surging AI chip demand .
• Infineon Technologies surged 5.8–6.8%, making it one of the strongest relative performers in the index .
• Soitec added 7% on the day, having already surged approximately 23% a week earlier on strong AI photonics demand .
• STMicroelectronics gained 3.8–4.1% .
• Aixtron rose 9% .

The broader European semiconductor sector had already rallied 69% in the second quarter of 2026, with Jefferies raising price targets on ASML and STMicroelectronics in early July .

Strong Corporate Earnings and Guidance Upgrades

A wave of positive corporate results provided additional fuel:

Schneider Electric surged approximately 11% after raising its 2026 guidance, driven by AI-driven data-centre demand . The company now expects organic revenue growth of up to 13% (from a prior 10%) and EBITA growth of 14–19% (from 10–15%) . First-half revenues reached a record €21.2 billion, with organic growth of 14% .

Crédit Agricole reported record quarterly revenue of €7.4 billion, with group net income up 1.4% to €2.05 billion . The bank also announced a €500 million AI investment plan; its shares rose approximately 2.9% .

Engie rose roughly 5% after first-half earnings beat expectations . The French utility raised its full-year EBIT guidance to €9.2–10.2 billion, supported by strong gas trading and higher power network fees . First-half EBIT came in at €5.3 billion, above the €5.1 billion analyst consensus .

The Laggards: Melrose Industries and Siemens Healthineers

Not all stocks participated in the rally. Melrose Industries fell 9.3%, the worst performer on the STOXX 600, after the GKN Aerospace owner reported a sharp decline in first-half pre-tax profit to £89 million from £379 million a year earlier . The company also flagged additional costs of £25–30 million in the second half following an incident at its Garden Grove facility in California .

Siemens Healthineers declined 3.3% after cutting its revenue forecast due to continued weakness in its diagnostics business .

Risks on the Horizon

Despite the record, investors remained cautious about several factors:

• Flash Eurozone CPI data was due later the same day, which could influence the European Central Bank's rate path . The ECB faces a complicated outlook: sticky inflation could delay rate cuts, while slowing growth might argue for easing .
• The week had featured central bank decisions and ongoing Middle East hostilities, which had kept markets on edge .
• The AI rally had been volatile earlier in the week, with Alphabet and Meta both experiencing sharp sell-offs before the Microsoft and Amazon results stabilised sentiment .

Summary: A Classic AI-Fueled Risk-On Day

The July 31 record high for the STOXX 600 was a textbook example of a global AI-driven risk-on rally. Blowout earnings from Big Tech ignited a wave of buying that swept through Asian semiconductor markets before landing in Europe, where strong local earnings from Schneider Electric, Crédit Agricole, and Engie provided additional momentum. The day demonstrated how deeply the AI trade has become the dominant driver of European equity markets, with the technology sector now a primary engine of index returns.