Europe Sets Record as Chip Selloff Meets Defensive Buying

By Nathan Brooks

The STOXX 600 closed at a record 664.14 on Friday, Nov. 13, up 0.02% for the day. Reuters described its 2.4% weekly gain as the best since June; calculated closing data put the rise at 2.44%. Insurers, utilities and oil producers offset another semiconductor selloff, producing a record with a split underneath that resembled a barbell, with chips at one end.

What carried the record?

The FTSE 100 added 0.36% to 10,902.56, a three-month closing high, and gained 2.14% over the week. Energy and defensive shares did much of the work in London.

France’s CAC 40 rose 0.09% to 8,368.91 for a fifth consecutive daily gain and finished the week 2.82% higher. Germany’s DAX slipped 0.08% to 26,749.95 as Infineon offset gains elsewhere, though the index still gained 3.60% for the week.

The Euro STOXX 50 fell 0.19% to 6,386.86 but advanced 3.51% over five sessions. The STOXX 600 began the week at 648.33 on Nov. 6 and edged above Thursday’s 664.01 record. On Thursday, Burberry and Munich Re had also outweighed a chip selloff; Wall Street opened mixed on Friday before technology losses deepened.

Why did chip stocks retreat?

Infineon fell 4.3% and ASML 2.8%, tracking lower U.S. AI infrastructure shares as investors considered Nvidia’s leadership change. STMicroelectronics lost 0.9% in Paris, while Schneider Electric slipped nearly 0.5%.

On Wall Street, the Philadelphia semiconductor index dropped 4% in afternoon trade. The Nasdaq Composite fell 1.4%, and Nvidia lost 3%.

Nvidia Chief Executive Jensen Huang resigned on Thursday. The U.S. Justice Department said it did not know whether a Chinese businesswoman at the center of the scandal was a spy, adding uncertainty around a leadership change that had already unsettled semiconductor shares.

Who provided the offset?

Allianz and Munich Re each gained about 1% after beating earnings expectations on Thursday. AXA rose 1.1%, even though Goldman Sachs had downgraded European insurers to “underweight” for 2027.

Aviva advanced 3.4% after reporting that general insurance premiums climbed 19% in the first nine months of 2026. Insurance earnings supplied the clearest evidence that investors were rewarding reported results rather than extending the previous week’s growth trades.

Eni and TotalEnergies gained about 2% each as crude prices rose. BP and Shell added about 1.5%, while the FTSE 350 utilities index climbed 1.1%, led by Centrica’s 3.8% gain.

Brenntag, E.ON and Fresenius Medical Care led the DAX higher. Hochtief fell 2.5% and MTU Aero Engines 1.3%; Airbus lost 0.8% and Safran 1.8% in Paris. Swiss luxury group Richemont closed down 3.8% after falling as much as 7% intraday despite strong quarterly sales.

Why did Europe outperform?

Information technology accounts for more than 35% of the MSCI USA Investable Market Index, with Nvidia alone at about 6.6%. Its European counterpart carries an 8.8% technology weighting, giving European indexes less exposure to crowded AI trades.

The STOXX 600 gained roughly 2.7% in November, while the Nasdaq-100 fell about 2.7% and Japan’s Nikkei dropped just over 3%. Alberto Conca, chief investment officer at Swiss wealth manager LFG+Zest, told Reuters: “Europe, which is more defensive, could continue to do well.”

His view had company results behind it. LSEG I/B/E/S data, based on reported results from 265 companies and estimates for the rest, put aggregate third-quarter profit growth for STOXX 600 companies at 25%. That would be the fastest pace in four years.

Energy profits were expected to jump nearly 151%, while growth excluding energy was forecast at 10%. Goldman Sachs strategists estimated European companies lose 1% of their total value for every 10% rise in Brent crude, keeping higher oil prices relevant to both sector earnings and index valuation.

What did rates and oil change?

The dollar index reached 103.35, its highest level since April 2025. CME FedWatch pricing assigned traders an 11% chance of a 50-basis-point Federal Reserve hike at the Dec. 8-9 meeting, up from zero a week earlier.

October U.S. producer prices rose 6.5% from a year earlier, slightly below expectations. The euro slipped 0.17% to $1.1034. LSEG data showed an above-84% chance of another 25-basis-point Bank of England rate hike in December.

Brent crude stood at $95.70 a barrel in U.S. afternoon trading, down 0.14% on the day and heading for a second consecutive weekly decline. Eurostat confirmed that the euro area grew 0.4% in the third quarter.

German lawmakers approved a 2027 budget requiring near-record borrowing. Neither the budget nor the euro-area growth figure changed the session’s central trade: investors bought defensives and energy while reducing semiconductor exposure.

What comes next for chip stocks?

With no company capacity or pricing guidance in the report, the next test for Infineon, ASML and STMicroelectronics is whether Nvidia’s leadership turmoil remains a temporary valuation shock. A broader retreat in AI infrastructure shares would make the three European chip names harder to defend, even as Europe’s lower technology weighting insulates the wider STOXX 600.