Stock markets fluctuated on Thursday as investors digested stronger-than-estimated US economic growth and record earnings at AI chip giant Nvidia.

The broad-base S&P 500 index and the tech-heavy Nasdaq opened higher but the Dow was flat.

Shares in Nvidia were down around one percent despite posting a profit of $26.4 billion on record revenue of $46.7 billion in the second quarter.

Investors had keenly awaited the earnings update late Wednesday from the California-based firm, whose robust growth has largely driven strong gains for tech stocks in recent months.

Its shares fell, however, as important data center revenue declined.

The earnings report comes amid market worries over a spending bubble in the artificial intelligence sector that could burst and hurt the chip giant's fortunes.

"The market seems to be asking whether Nvidia can keep up this pace as competition intensifies and AI enthusiasm starts to look a little overbought," said Joshua Mahony, chief market analyst at traders Scope Markets.

Investors were also reacting to US data showing that the world's biggest economy grew 3.3 percent in the second quarter, up from an initial estimate of 3.0 percent in July.

"After the initial release, there were concerns that the domestic economy was slowing quite sharply," said Richard Flax, chief investment officer at Moneyfarm.

"But these latest data suggest that the economy is a bit stronger than initially feared," he said.

The upward revision mainly reflected improvements in investment and consumer spending, the Commerce Department said.

But overall, growth in the second quarter was also bolstered by a fall in US imports, which are subtracted from the GDP. 

This drop came as businesses pulled back on shipments after rushing to stock up ahead of US President Donald Trump's tariff hikes.

The data could offer insight into the outlook for US interest rates, with the Federal Reserve eyeing further cuts to borrowing costs in a bid to boost the US economy.

"Overall, this release probably doesn't change Federal Reserve thinking too much," Flax said, adding that the central bank was still expected to cut rates by 25 basis points at its September meeting.

"But a stronger than expected result from domestic demand suggests that there might not be that much scope to cut rates over the next 12 months."

In Europe, the Paris stock market extended its recovery, having tumbled early in the week on fears that France's minority government could be toppled.

This was after Prime Minister Francois Bayrou proposed a confidence vote over his proposed budget cuts.

France's borrowing costs have soared since the vote was called Monday, as the government wrestles with how to find around 44 billion euros ($51 billion) in savings.

The Frankfurt stock market rose in afternoon deals while London fell.

Key figures at around 1335 GMT

New York - Dow: FLAT at 45,569.65 points 

New York - S&P 500: UP 0.1 percent at 6,490.07

New York - Nasdaq: UP 0.3 percent at 21,662.81

London - FTSE 100: DOWN 0.5 percent at 9,211.94 

Paris - CAC 40: UP 0.4 percent at 7,775.11 

Frankfurt - DAX: UP 0.1 percent at 24,070.13

Tokyo - Nikkei 225: UP 0.7 percent at 42,828.79 (close) 

Hong Kong - Hang Seng Index: DOWN 0.8 percent at 24,998.82 (close)

Shanghai - Composite: UP 1.1 percent at 3,843.60 (close)

Euro/dollar:  UP at $1.1662 from $1.1633 on Wednesday

Pound/dollar: DOWN at 1.3492 from $1.3496

Dollar/yen:  DOWN at 147.15 from 147.51 yen 

Euro/pound: UP at 86.43 from 86.20 pence 

West Texas Intermediate: DOWN 0.4 percent at $63.89 per barrel

Brent North Sea Crude: DOWN 0.4 percent at $67.17 per barrel