European stocks close higher as region’s chip stocks surge

European stocks closed higher Thursday, led by AI chip stocks which surged following record earnings by TSMC.

The pan-European Stoxx 600 finished the session 0.6% higher, with most major bourses and sectors in positive territory.

Dutch semiconductor equipment maker ASML popped as much as 7% in early afternoon dealmaking, sending it to record highs, as investors responded to stronger-than-expected earnings from Taiwan’s TSMC. ASML finished the day 6% higher.

TSMC reported a 35% increase in fourth-quarter profit, beating estimates and hitting a fresh record as demand for artificial intelligence chips remained strong.

ASM International closed 11.2% higher, and BE Semiconductor gained 7.3%.

UniCredit rose 1.4% after the Italian bank said that recent reports that it was planning to buy a stake in rival lender Banca Monte dei Paschi di Siena are “speculative in nature and unjustified” and “pure invention.”

European bank M&A activity is expected to pick up this year — with Italy seen as a deal hotspot — and analysts see MPS as among the key targets. “M&A is a strategic tool for the bank,” UniCredit said in a statement.

Regional investors were assessing the outcome of a high-stakes meeting between senior officials from the U.S., Denmark and Greenland on Wednesday to discuss the ownership of the Arctic island.

U.S. President Donald Trump’s sees the semi-autonomous Danish territory as critical for national security and has threatened to seize it by force, if necessary.

A meeting at the White House between officials from Greenland, Denmark, and the U.S. Wednesday ended with “fundamental disagreement” over the ownership of the island, a Danish official said following the meeting, but that both sides would continue to talk.

Ahead of the talks, Trump doubled down on acquiring the territory, stating on social media that anything less than Greenland becoming a part of the United States was “unacceptable.”