Category: Market News

Shares of Wizz Air Holdings PLC (LSE:WIZZ) dropped more than 8% on Thursday after the low-cost airline released an unexpected profit warning, saying the escalating Middle East crisis is expected to reduce fiscal 2026 net profit by about €50 million and push earnings below its previously guided range of €25 million to -€25 million.

The Budapest-based carrier said the projection assumes current spot jet fuel prices and prevailing foreign exchange rates remain broadly unchanged for the rest of the financial year.

Analysts at RBC Capital Markets, who had already been forecasting a €27 million net loss — below the €15 million loss consensus estimate tracked by Visible Alpha — said the warning is likely to trigger further downward revisions to market expectations.

Wizz Air’s fuel hedging strategy leaves it more exposed than many of its European competitors. Rather than locking in prices through fixed hedges, the airline uses a cap-and-collar structure that still exposes it to price volatility within certain bands, even for fuel volumes that are technically hedged. In addition, the airline’s route network is more heavily oriented toward eastern markets, increasing its direct exposure to the regional conflict.

RBC also highlighted that both Wizz Air and Air France-KLM carry relatively high debt levels, making their shares more sensitive to geopolitical developments compared with airlines that operate with lower leverage.

By contrast, Ryanair and Jet2 plc have minimal direct exposure to the Middle East, less near-term exposure to spot fuel prices and net cash balance sheets. RBC rates both stocks Outperform, with price targets of €32.00 and GBp2,150 respectively.

The bank also warned of additional pressure on Wizz Air’s earnings beyond FY26, pointing to potential pricing challenges as the airline targets roughly 30% seat capacity growth in the first half of FY27. RBC also expects income from sale-and-leaseback gains, compensation payments and foreign exchange translation to decline compared with FY26 levels.

RBC maintained its Sector Perform rating on Wizz Air with a price target of GBp1,200, stating it sees more attractive risk-reward opportunities elsewhere in the airline sector.

The bank added that although European airline stocks in general face pressure from the ongoing conflict, any de-escalation could deliver the biggest upside to airlines with the greatest exposure to the Middle East, with Wizz Air among the most affected.

Oil prices surged again on Thursday, extending the recent rally as the conflict in the Middle East entered its sixth day with no clear signs of easing, raising fears of disruptions to supply from one of the world’s most important crude-producing regions.

At 03:35 ET (08:35 GMT), Brent crude futures for May delivery rose 2.6% to $83.54 a barrel, while U.S. West Texas Intermediate (WTI) crude futures advanced 3.1% to $76.96 a barrel.

Both benchmarks are now heading for a fifth straight day of gains, with Brent trading just below its highest level since July 2024.

Middle East conflict, Strait of Hormuz risks remain in focus

The Middle East conflict, which erupted over the weekend when the United States and Israel carried out coordinated strikes against Iran, continues to escalate with little indication of a near-term resolution. Tensions intensified after the U.S. sank an Iranian warship near Sri Lanka in international waters, highlighting the growing geographic reach of the confrontation.

On Wednesday, the U.S. Senate rejected a proposal — largely divided along party lines — that aimed to halt the air campaign and require congressional approval for further military action.

At the same time, Tehran dismissed reports claiming that Iran’s Ministry of Intelligence had contacted Washington to discuss a potential end to the conflict, describing the report as “pure falsehood” and accusing Western media of spreading misinformation. The denial dampened hopes for a diplomatic breakthrough in the near term.

Concerns over oil supply have grown after Iran effectively shut down the Strait of Hormuz, one of the world’s most critical oil shipping routes through which roughly one-fifth of global crude flows.

The disruption is already affecting regional output. Reports indicated that Iraq declared force majeure on certain crude exports as shipments through the Strait of Hormuz were heavily disrupted.

Iraq, the second-largest oil producer in the Organization of the Petroleum Exporting Countries, has cut output by nearly 1.5 million barrels per day due to limited storage capacity and the lack of viable export routes, officials told Reuters.

“Successfully blocking the Strait of Hormuz would leave significant upside to the market, potentially with Brent hitting $140/bbl, with supply losses unable to be offset,” said analysts at ING in a note. “However, a full and prolonged blockage of the strait would likely be unsuccessful, with any attempts to do so leading to a rapid response. Partial disruptions, which could include seizing or attacking tankers, would likely mean Brent spikes towards $100/bbl initially but settles in a largely $80-90/bbl range.”

U.S. crude inventories rise more than forecast – API

Weekly data from the American Petroleum Institute (API) showed that U.S. crude inventories increased by around 5.6 million barrels in the week ended Feb. 28, well above expectations for a build of roughly 2.2 million barrels, though still significantly lower than the previous week’s rise of 11.4 million barrels.

Traders are now awaiting the official inventory figures from the U.S. Energy Information Administration (EIA), due later on Thursday, for confirmation of the increase.

Gold prices moved higher on Thursday as escalating tensions in the Middle East boosted demand for the precious metal as a safe-haven asset.

At 06:05 ET (11:05 GMT), spot gold was up 0.5% at $5,167.00 an ounce after earlier touching levels above $5,200/oz during the session. U.S. gold futures rose 0.8% to $5,176.35/oz.

The metal had already gained about 1% in the previous trading session. That recovery followed a sharp drop of nearly 5% on Tuesday when a stronger dollar weighed heavily on prices.

Gold supported by heightened Middle East tensions

Geopolitical risks remain elevated after the United States sank an Iranian warship in international waters, while Iran continued launching missiles across multiple countries in the region and reportedly targeted key energy infrastructure.

The escalation has intensified fears of a prolonged regional conflict, prompting investors to trim exposure to riskier assets and shift funds toward gold, which is widely regarded as a hedge during periods of geopolitical uncertainty and market volatility.

“Looking ahead, gold faces competing macro forces,” said analysts at ING in a note. “The inflationary impact of the Middle East conflict, via sharply higher energy prices, could reinforce expectations of higher interest rates for longer — a headwind for non yielding assets such as gold.”

“However, elevated geopolitical uncertainty continues to support a risk premium, helping to underpin prices despite the challenging rates backdrop,” they added.

Dollar strength caps gold’s upside

Market participants are also closely watching the U.S. Dollar Index, which rebounded Thursday after slipping 0.3% overnight. Earlier in the week the index logged two consecutive sessions of strong gains.

A firmer dollar typically pressures gold because it raises the metal’s cost for buyers using other currencies.

“Uncertainty typically supports safe havens, implying upside for gold,” Morgan Stanley strategists led by Amy Gower wrote in a note, but added that recent price action has been “more mixed with USD strength.”

Several forces are currently shaping gold prices simultaneously, including expectations for Federal Reserve interest-rate cuts, currency movements, geopolitical risks and overall liquidity conditions in financial markets.

According to the strategists, the recent wave of selling in gold may reflect investors raising cash during periods of market stress rather than a shift in the longer-term outlook.

“We think gold’s underperformance is likely to be temporary if the current situation continues, with recent selling most likely due to the need for liquidity,” the strategists said.

Among other precious metals, silver rose 1.6% to $84.53 per ounce, while platinum gained 1% to $2,176.200/oz.

Benchmark copper futures on the London Metal Exchange fell 1.2% to $12,904.00 a ton, while U.S. copper futures dropped 1.3% to $5.8308 a pound.

Bitcoin (COIN:BTCUSD) held firm on Thursday after improving market sentiment and optimism around potential regulatory progress helped fuel a strong rebound in the world’s largest cryptocurrency, although uncertainty tied to the Iran conflict continued to weigh on investor confidence.

Bitcoin advanced more than 5% to $72,366.1 by 01:28 ET, after climbing to a one-month peak of $73,243 during Wednesday’s session.

The cryptocurrency later trimmed part of its advance after U.S. stock index futures slipped into negative territory early Thursday, as ongoing tensions involving the United States, Israel and Iran kept markets cautious.

A sharp jump in oil prices also heightened worries about the conflict’s potential to push inflation higher.

Bitcoin gains with help from Wall Street, Trump remarks

Bitcoin rallied strongly on Wednesday, extending earlier gains this week as a positive trading day on Wall Street lifted appetite for risk assets. Bargain hunting also supported the move after the cryptocurrency suffered steep declines in February.

Crypto markets also drew support after U.S. President Donald Trump urged lawmakers to fast-track a long-delayed bill designed to establish a regulatory framework for digital assets, while criticizing major U.S. banking groups for opposing yield payments on stablecoins.

Trump’s remarks raised expectations that the cryptocurrency industry could receive a more supportive regulatory environment in the United States. However, there was little sign of immediate progress toward passing the CLARITY Act, legislation intended to define the industry’s market structure.

Bitcoin also benefited from overnight gains on Wall Street after reports suggested Iran had reached out to Washington seeking dialogue, which briefly boosted hopes that the conflict might ease.

Those hopes faded after Tehran denied the reports and launched a fresh missile barrage toward Israel early Thursday, tempering the improvement in risk appetite.

Ray Dalio says Bitcoin is no gold

Billionaire hedge fund manager Ray Dalio reiterated his criticism of Bitcoin earlier this week, arguing that the cryptocurrency should not be compared with gold because it lacks support from central banks, provides no real privacy and remains exposed to potential breakthroughs in quantum computing.

“A lot of attention has been given to Bitcoin, but as a money, it’s small in relationship to gold… there is only one gold,” Dalio said.

Speaking during a podcast interview, the founder of Bridgewater Associates questioned Bitcoin’s role as a safe-haven asset and also warned about possible privacy vulnerabilities.

Dalio has long been critical of Bitcoin. But in 2025 he said he holds roughly a 1% allocation to the cryptocurrency in his portfolio and suggested investors consider allocating around 15% to Bitcoin or gold amid rising concerns about a potential U.S. debt crisis.

Crypto price today: altcoins follow Bitcoin higher, recover February losses

Other cryptocurrencies also moved higher on Thursday, tracking Bitcoin’s rally as the broader digital asset market recovered part of the losses recorded in the previous month.

The world’s second-largest cryptocurrency, Ethereum, gained 7.5% to $2,128.35, while XRP climbed 4.7% to $1.4238.

Solana, Cardano and BNB rose between 3% and 7%.

Among meme coins, Dogecoin jumped 8%, while Official Trump added 2.2%.

Davide Campari-Milano N.V. (BIT:CPR) shares climbed more than 6% on Thursday after the drinks maker reported full-year results that exceeded analyst expectations, standing out in a sector downturn that has recently pressured competitors such as Diageo plc (LSE:DGE) and Pernod Ricard S.A. (EU:RI).

For the year ended 31 December 2025, Campari posted organic sales growth of 2.4% and organic EBIT growth of 5.4%, outperforming Visible Alpha consensus forecasts of 1.6% and 1.9% respectively. Net sales reached €3.051 billion, although a 3.0% foreign exchange headwind partly offset the underlying performance.

The board proposed a full-year dividend of €0.100 per share, a sharp increase from €0.065 previously. At the same time, the group’s net debt to EBITDA ratio declined to 2.5 times from a peak of 3.6 times recorded in September 2024, allowing the company to reach its leverage target one year earlier than planned.

“Strong business momentum and accelerated deleverage one year ahead of plan allowed us to step-up our dividend payout to further enhance shareholder returns,” said Simon Hunt.

Adjusted EBIT came in at €637 million, representing a margin of 20.9% and organic improvement of 60 basis points. Recurring free cash flow reached €571 million, with a conversion rate of 73%. Adjusted diluted earnings per share were €0.32, reflecting growth of 2.7%.

A strong final quarter contributed to the full-year outperformance, with organic sales increasing 4.7% and organic EBIT rising 24.3% in the fourth quarter.

Analysts at Morgan Stanley raised their price target for the stock to €6.60 from €6.30, describing the results as “a very strong end to the year,” while maintaining an “equal-weight” rating. The bank also highlighted some uncertainty around the sustainability of recent growth drivers, noting that shipments in Italy increased 5% in the fourth quarter even as on-trade sell-out declined 1%.

Looking ahead to 2026, Campari said it expects organic revenue growth to continue at a similar pace. However, the company warned of a potential €30 million impact from U.S. tariffs over the full year, as well as an estimated €70 million revenue headwind related to the disposal of non-core brands such as Cinzano and Averna.

STMicroelectronics N.V. (BIT:STM) was among the strongest performers on the Milan stock exchange today after signals of increased investment in the technology sector from the Chinese government boosted sentiment across Asian tech stocks.

Shares in the chipmaker climbed about 6% within the first hour of trading, second only to Davide Campari-Milano N.V., reaching €29.52 and returning to their highest level since late February.

The stock has now gained around 25% since the start of January 2026, bringing its performance over the past 12 months to roughly +28%.

Speaking at the opening of the annual “Two Sessions,” Chinese Premier Li Qiang announced a GDP growth target for the current year of between 4.5% and 5%, the lowest target set since 1991.

To support economic expansion amid weak domestic consumption and ongoing trade tensions, Beijing confirmed a budget deficit target of 4% and outlined a policy approach centred on high-technology sectors such as artificial intelligence and semiconductors, alongside strengthening defence capabilities.

Authorities also introduced measures within the 2026 Action Plan aimed at attracting higher-quality foreign investment and stabilising the property sector, while encouraging stronger collaboration between private capital and industrial innovation.

Although the growth target is the lowest in decades, markets appear to be responding positively to the clear policy support for the technology industry.

China represents about 15% of STMicroelectronics’ total revenue, and Beijing’s commitment to supporting consumption and digital infrastructure provides a positive signal for a semiconductor sector that struggled with oversupply during 2025.

The push toward electric vehicles and semiconductor development is particularly relevant for STM, which supplies components to manufacturers including Tesla Inc. and Geely Automobile Holdings. China’s accelerated adoption of new energy vehicles (NEVs) is expected to boost demand for silicon carbide (SiC), a technology segment in which the company aims to maintain global leadership.

Local partnerships also play a key role in the group’s strategy. Through its “in China for China” approach—including a joint venture with Sanan Optoelectronics for domestic production—STM can benefit from Chinese government incentives while reducing exposure to geopolitical tensions between the United States and China.

Separately, STMicroelectronics announced the launch of the STM32C5 family of entry-level microcontrollers, designed for billions of connected devices used in factories, homes, cities and infrastructure.

According to the company, the new chips are built using its proprietary 40nm process and are based on the Arm Cortex-M33 architecture, delivering stronger performance than existing entry-level devices. They include up to 1MB of Flash memory, enhanced security features such as SESIP3 and PSA Level 3 certification, protection against tampering and cyber threats, and integration with the STM32Cube development ecosystem.

The microcontrollers are suited for applications including smart thermostats, electronic locks, industrial sensors, robotic actuators and wearable devices. Production has already started, with prices beginning at $0.64 for orders of 10,000 units, and evaluation boards are currently available, the company said.

Coats Group plc (LSE:COA) increased its medium-term operating margin target to 21–23% from the previous 19–21% on Thursday and lifted its five-year free cash flow objective to around $1bn. The update followed the release of 2025 results that broadly matched market expectations, with the shares rising more than 3% in London trading.

The company reported adjusted operating profit of $290m on revenue of $1.465bn. Organic sales were broadly flat compared with markets that Coats estimated declined by low- to mid-single digits. Operating margin improved by 80 basis points to 19.8%.

“2025 was a transformational year for Coats. We achieved record profit and cash generation, reshaped the portfolio for accelerated growth and reorganised the Group for simplicity. As a result, we have upgraded our medium-term financial targets, including c.$1bn of free cash, and look at 2026 with confidence,” said David Paja.

Adjusted earnings per share reached 9.3 cents, slightly ahead of the 9 cents consensus forecast. However, earnings were partly weighed down by higher interest costs following a pension settlement in 2024 and a $322m equity raise used in part to finance the October acquisition of OrthoLite for an enterprise value of $770m.

Analysts at RBC Capital Markets, which rates the stock “outperform” with a price target of 115 pence, said they viewed Coats as “a high-quality business with structural growth potential that is not reflected in a P/E of 11.5x26E with an FCF yield of 9% and rising from 2026E also supportive.”

The group generated record free cash flow of $160m, surpassing its own forecast of $132m. Net debt increased to $815m from $449m, while pro forma leverage stood at 2.2 times, comfortably below the covenant limit of three times. The company expects leverage to fall below two times by the end of 2026.

Within the business segments, footwear revenue declined 2% organically, as U.S. tariff disruptions prompted customer destocking that continued through the end of the year. Apparel revenue increased 1% organically despite an estimated 3% contraction in the overall market. Coats said it captured roughly 100 basis points of market share in both divisions.

OrthoLite contributed $42.6m in revenue and $10.5m in operating profit during its first two months under Coats ownership. The company aims to achieve $20m in annualised cost synergies from the acquisition by 2028. Meanwhile, revenue from fully recycled thread products climbed 43% to $554m.

Looking ahead, the company expects organic growth in 2026 despite uncertain market conditions and warned that geopolitical tensions in the Middle East could pose risks to demand.

Consensus forecasts for the full year currently point to revenue of $1.76bn and adjusted operating profit of $371m, which management said are consistent with its expectations.

The board proposed a final dividend of 2.28 cents per share, an increase of 4%. The company maintained its medium-term targets of annual earnings per share growth above 10% and revenue growth exceeding 5%.