European equities showed muted movement on Tuesday as renewed trade tensions and ongoing concerns about artificial intelligence-driven disruption kept investor sentiment cautious.
With markets also monitoring geopolitical risks related to Iran, tariff developments and the broader economic outlook, investors are now looking ahead to U.S. President Donald Trump’s State of the Union address to Congress for further direction.
Germany’s DAX Index slipped 0.1%, while the U.K.’s FTSE 100 Index edged up 0.1% and France’s CAC 40 Index gained 0.2%.
Banking stocks came under pressure, with Commerzbank (TG:CBK), Deutsche Bank (TG:DBK) and BNP Paribas (EU:BNP) declining between 1% and 2% amid concerns about the potential long-term impact of AI on employment, consumer trends, economic growth, corporate earnings and equity markets.
Automakers, meanwhile, posted broad gains. Shares of BMW (TG:BMW), Mercedes Benz (TG:MBG), Volkswagen (TG:VOW3) and Renault (EU:RNO) each rose more than 1%, even after new data showed European car sales declined year-on-year in January for the first time since June.
Spanish telecommunications group Telefonica (BIT:1TEF) advanced nearly 2% after reporting accelerating core profit growth in the fourth quarter.
France-based vouchers and employee benefits provider Edenred (EU:EDEN) jumped around 7% after delivering core profit results for 2025 that exceeded expectations.
Shares of Belgian chemicals company Solvay (EU:SOLB) climbed 3.4% after the group reported fourth-quarter adjusted earnings ahead of analyst forecasts.
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