European Auto Shares Rise on Chip Supply Optimism Amid China Export Plans

European auto stocks, including BMW, Mercedes-Benz, Volkswagen, Renault, and others, rose significantly amid optimism about the easing of semiconductor supply shortages caused by the Dutch government's seizure of chipmaker Nexperia and the subsequent export restrictions imposed by China. China's Commerce Ministry indicated it would loosen export restrictions on chips made by Nexperia, while both U.S. and Chinese governments removed barriers to Nexperia shipping its chips from China, alleviating tensions in the chip supply chain. This development boosted shares in European automakers and car parts makers such as Forvia, Valeo, and OPMobility, with the latter two also benefiting from positive supply outlooks. Despite recent declines in deliveries and sales for some automakers like BMW in China, most European manufacturers confirmed they have adequate semiconductor supplies in the short term and are actively addressing potential production disruptions. The broader European stock market showed modest gains, with the Stoxx 600 and other indexes reflecting cautious investor optimism fueled by improved earnings outlooks and the chip supply resolution. However, industry groups warn of possible assembly line stoppages if supply issues persist, keeping the situation under close watch.