Category: Market Summary

Stocks gain despite Middle East tensions and looming U.S. tech earnings

European equity markets traded higher on Wednesday as investors balanced escalating geopolitical risks in the Middle East against signs of easing inflation in the United Kingdom and awaited earnings from several major U.S. technology companies.

Oil prices remained in focus after Brent crude surged almost 4% to its highest level in seven weeks, climbing above $94 a barrel. The rally followed an 11th consecutive night of U.S. military strikes against Iran, while President Trump pledged further action targeting Pickaxe Mountain. Iranian media also reported explosions in Bushehr, where the country’s nuclear power facility is located.

UK inflation slows more than expected

Investor sentiment received some support from fresh economic data showing that inflation in the UK continued to moderate.

Figures released by the Office for National Statistics showed that the consumer price index increased 2.6% year over year in June, easing from 2.8% in May and coming in below economists’ expectations of 2.7%.

On a monthly basis, consumer prices rose 0.1%, matching forecasts and slowing from the 0.2% increase recorded in May.

By midday trading, London’s FTSE 100 had gained 1.4%, while France’s CAC 40 advanced 0.9% and Germany’s DAX added 0.3%.

Corporate earnings drive individual movers

Among the day’s strongest performers, Randstad (EU:RAND) rallied after reporting quarterly organic revenue growth that exceeded market expectations.

Santander (LSE:BNC) also moved higher after posting a 17% increase in underlying second-quarter net profit, supported by robust performances in Spain and the United Kingdom.

Airbus (EU:AIR) climbed after unveiling a €5 billion share repurchase programme to be executed over the next three years while reaffirming its fiscal 2026 guidance for approximately 870 commercial aircraft deliveries and adjusted EBIT of around €7.5 billion.

Shares of Germany’s GEA Group (TG:G1A) advanced after the company released stronger-than-expected preliminary second-quarter results and upgraded its full-year outlook.

Fresnillo (LSE:FRES) also gained after reaffirming its production guidance for 2026 through 2028 following solid operational performance during the second quarter.

Weak outlooks pressure several stocks

Not all companies shared in the broader market strength.

Dutch telecommunications provider KPN (EU:KPN) declined after slightly lowering its forecast for 2026 service revenue growth.

Swiss pharmaceutical manufacturing specialist Lonza (TG:LO3) also fell after first-half revenue narrowly missed analysts’ expectations.

Meanwhile, British pub operator J D Wetherspoon (LSE:JDW) dropped sharply after warning that full-year profit is expected to come in below previous market forecasts.

US equity futures traded slightly lower on Wednesday as investors prepared for a crucial day of corporate earnings led by Alphabet, Texas Instruments and Tesla, while higher oil prices and geopolitical tensions continued to shape market sentiment.

The combination of major technology results, artificial intelligence spending expectations and rising energy costs is expected to set the tone for financial markets in the coming sessions.

Markets await key technology earnings

Wall Street futures pointed modestly lower ahead of the opening bell after US equities closed higher on Tuesday, supported by gains across the semiconductor sector.

The Philadelphia Semiconductor Index advanced more than 5%, marking its strongest daily performance in a month as investors continued to back companies expected to benefit from growing AI investment.

Alphabet’s outlook on AI spending in focus

Alphabet (NASDAQ:GOOG) will publish second-quarter earnings after markets close, with investors expected to scrutinise both financial performance and capital expenditure plans.

The Google parent remains one of the largest investors in artificial intelligence infrastructure, including data centres and custom semiconductors. While these investments are intended to strengthen long-term growth, investors continue to debate when they will begin generating meaningful returns.

BofA Securities believes Alphabet could raise its planned 2026 capital expenditure to between $190 billion and $200 billion, reflecting stronger AI demand and higher memory chip prices.

The broker added that “see Alphabet well positioned to drive outsized growth [and] cloud margin upside given favorable AI positioning across models, silicon, consumer [and] enterprise distribution.”

Wall Street forecasts cited by BofA Securities point to quarterly revenue of approximately $101 billion and earnings per share of $2.90.

Chip sector and Tesla also under the spotlight

Texas Instruments (NASDAQ:TXN) is expected to provide another important update on semiconductor demand, with analysts viewing its results as a useful indicator of broader industry conditions.

The company forecasts quarterly revenue between $5 billion and $5.4 billion, alongside earnings per share of $1.77 to $2.05.

Tesla (NASDAQ:TSLA) will also report after the close, with markets anticipating its first quarterly cash burn in more than two years as the company accelerates investment in artificial intelligence, autonomous vehicles and robotics.

Oil prices remain elevated

Crude oil prices continued to strengthen following another round of US military strikes on Iranian targets, adding to concerns over supply disruptions in the Middle East.

Brent crude traded above $94 per barrel, while WTI remained above $87, extending a multi-session rally that has increased concerns over inflation and interest rates.

Investors will continue monitoring corporate earnings, developments in the AI sector and geopolitical risks as markets look for the next major catalyst.

European equity markets traded modestly lower on Wednesday as investors balanced a busy earnings calendar against fresh geopolitical tensions in the Middle East, while awaiting key monetary policy and economic updates later in the week.

Market participants also looked ahead to quarterly results from major US technology companies and the European Central Bank’s latest interest rate decision, both expected to influence market sentiment.

Investors digest inflation and earnings reports

The pan-European STOXX 600 slipped 0.4% in early trading. Germany’s DAX was broadly unchanged, France’s CAC 40 declined 0.1%, and Italy’s FTSE MIB also eased 0.1%, weighed down by weakness in banking shares.

In the UK, the FTSE 100 edged 0.1% lower despite inflation data showing consumer price growth slowed to 2.6% in June from 2.8% in May, coming in below economists’ expectations of 2.7%.

The softer inflation reading reinforced expectations that the Bank of England could gain greater flexibility on interest rates while supporting confidence in Prime Minister Andy Burnham’s commitment to fiscal discipline.

Corporate results dominate trading

Company earnings remained the primary driver of individual share price movements across Europe.

Banco Santander (LSE:BNC), UniCredit (BIT:UCG) and Equinor (NYSE:EQNR) were among the major companies releasing quarterly results, offering investors fresh insight into how businesses are performing against a backdrop of elevated borrowing costs and ongoing market uncertainty.

Santander shares fell around 2% following the publication of its latest earnings.

Meanwhile, Akzo Nobel (EU:AKZA) gained nearly 3% after reporting its second-quarter results.

Higher oil prices support energy sector

Oil prices moved higher after renewed attacks by Yemen’s Houthi movement on commercial vessels operating along key shipping routes, increasing concerns over potential disruptions to global energy supplies.

The renewed geopolitical tensions helped support energy stocks by maintaining a risk premium in crude markets, although higher fuel costs also added to inflation concerns ahead of Thursday’s European Central Bank policy announcement.

Investors are expected to remain focused on central bank guidance, corporate earnings and developments in global energy markets as trading progresses through the week.

FTSE 100 opens steady as oil prices temper softer UK inflation. Fresnillo maintains guidance while Reach strengthens cash flow despite lower revenue.

Market Overview

The FTSE 100 opened broadly flat, while the Euronext 100 edged lower and Germany’s DAX moved slightly higher at the start of trading. Overnight, US markets finished stronger, with the Nasdaq and S&P 500 both posting gains. Sentiment remained cautious as softer UK inflation was offset by firmer oil prices, while European investors monitored renewed Houthi shipping attacks and ongoing Middle East tensions ahead of US technology guidance.

Commodity markets continued to reflect geopolitical risks, with copper and natural gas strengthening, while gold and Brent crude eased slightly from the previous close. Bitcoin was down against sterling. Currency moves versus the pound were subdued, with sterling marginally firmer against the US dollar and euro but little changed against the Swiss franc, Japanese yen and Australian dollar.

Market Numbers

FTSE 100: Down (-0.001%), 10,585.87
Euronext 100: Down (-0.02%), 1,920.00
DAX: Up (+0.05%), 25,022.61
NASDAQ: Up, 25,837.21
S&P 500: Up, 7,509.20

In the Headlines

Silver production – Fresnillo (LSE:FRES)
Fresnillo maintained its 2026 production guidance after delivering a steady second quarter across its precious metals operations. The update supports expectations for full-year output despite ongoing operational challenges.

Cash generation – Reach (LSE:RCH)
Reach reported lower first-half revenue but preserved operating margins through cost reductions while strengthening cash generation. Improved cash conversion and lower leverage reinforce the publisher’s financial resilience despite continued pressure on print and digital revenues.

Currencies (vs GBP)

USD: Up (+0.01%), $1.3379
CHF: Down (-0.00%), Fr.1.0872
EUR: Up (+0.00%), €1.1733
JPY: Down (-0.00%), ¥218.3294
AUD: Down (-0.00%), $1.9111
Bitcoin (BTC/GBP): Down, £49,165.78

Commodities

Copper: Up
Gold: Down
Brent Crude: Down
Natural Gas: Up

The FTSE 100 edged lower on Wednesday as investors balanced a larger-than-expected slowdown in UK inflation against renewed gains in oil prices driven by escalating tensions in the Middle East. Although the latest inflation data strengthened expectations that the Bank of England could begin cutting interest rates sooner, higher energy prices and geopolitical uncertainty limited risk appetite across European markets.

Inflation cools while geopolitical tensions intensify

The FTSE 100 slipped 0.08% in early trading. Elsewhere in Europe, Germany’s DAX added 0.04%, while France’s CAC 40 eased 0.06%. Sterling strengthened 0.09% against the US dollar to $1.3383.

Market sentiment remained cautious as the conflict between the United States and Iran intensified. US Central Command said it had carried out an eleventh consecutive night of strikes targeting Iranian military infrastructure, while Iran reported attacks across several provinces. The ongoing conflict has fuelled concerns over shipping through the Strait of Hormuz, a key global energy route, pushing crude oil prices sharply higher.

Speaking at an ASEAN meeting in Manila, US Secretary of State Marco Rubio warned that any attempt by Iran to control the Strait of Hormuz would “create a very dangerous precedent which will repeat itself in other parts of the world.”

UK inflation beats forecasts

Fresh data from the Office for National Statistics showed UK consumer price inflation eased to 2.6% in June, down from 2.8% in May and below economists’ expectations of 2.7%.

Lower motor fuel prices were the biggest contributor to the decline, with diesel prices falling by 10.7 pence per litre. Producer price inflation also moderated, with input prices rising 7.3% year on year compared with 9.3% in May, while output prices increased 3.5%.

The figures reinforced expectations that the Bank of England could begin easing monetary policy in the coming months if inflation continues to move towards its target.

Oil and gold extend gains

Energy markets remained volatile as geopolitical risks persisted. Brent crude rose 2.54% to $93.32 a barrel, while US West Texas Intermediate crude gained 2.50% to $86.44.

Safe-haven demand also supported precious metals, with gold futures climbing 1.10% to $4,121.45 an ounce and spot gold advancing 0.97% to $4,117.22.

UK corporate highlights

Among individual stocks, J D Wetherspoon (LSE:JDW) warned that full-year profit would fall below market expectations after weaker fourth-quarter trading and continued cost inflation.

Henry Boot (LSE:BOOT) also issued a profit warning, citing weaker land sales and slower demand from housebuilders amid political uncertainty and geopolitical tensions.

Mulberry (LSE:MUL) reported a strong start to the new financial year, with first-quarter revenue rising 23% as its turnaround strategy continued to gain momentum.

Fresnillo (LSE:FRES) maintained its full-year production guidance despite lower silver output in the second quarter, supported by stronger gold production compared with the previous quarter.

Greencore (LSE:GNC) upgraded its full-year earnings guidance after reporting strong third-quarter trading and continued progress integrating Bakkavor.

Strong corporate results support pre-market trading

U.S. equity futures traded higher on Tuesday as investors responded positively to another round of stronger-than-expected corporate earnings, positioning markets for a rebound after Monday’s decline.

The improved mood followed upbeat quarterly reports from several large companies, encouraging investors to re-enter the market after recent selling pressure.

3M, General Motors and Novartis lift the market

Industrial giant 3M (NYSE:MMM) climbed more than 7% in pre-market trading after posting quarterly earnings and revenue above expectations while increasing its full-year guidance.

General Motors (NYSE:GM) also moved higher after reporting second-quarter results that exceeded analyst forecasts and raising its outlook for 2026.

Healthcare company Novartis (NYSE:NVS) joined the rally after delivering second-quarter earnings that also surpassed market estimates.

Technology shares added to the positive tone, with Nasdaq 100 futures gaining around 1.2% ahead of the opening bell.

Focus shifts to Big Tech earnings

Despite the stronger start, investors remain cautious ahead of a busy earnings calendar later this week.

Quarterly reports from Alphabet (NASDAQ:GOOGL), IBM (NYSE:IBM) and Tesla (NASDAQ:TSLA) are expected to provide important updates on enterprise spending, artificial intelligence investment and broader economic trends.

Oil rally tempers market enthusiasm

Higher energy prices continued to cloud the outlook for equities.

U.S. crude oil futures advanced roughly 2% as tensions between the United States and Iran persisted, raising concerns that elevated oil prices could complicate the inflation outlook and delay potential interest-rate cuts.

Monday ended with broad market losses

Although Wall Street opened higher on Monday, buying momentum faded as geopolitical risks and rising Treasury yields prompted investors to reduce exposure.

The Dow Jones Industrial Average dropped 0.6%, the S&P 500 declined 0.2% and the Nasdaq Composite slipped 0.1%.

Housing stocks led the declines as higher bond yields weighed on the sector, while pharmaceutical, biotechnology, transportation and healthcare shares also lost ground. Software companies were among the session’s strongest performers.

Separately, the Conference Board reported that its Leading Economic Index fell 0.2% in June, a slightly weaker reading than economists had anticipated.

Markets hold steady ahead of major technology results

European equities traded in a narrow range on Tuesday as investors remained focused on diplomatic efforts to reduce tensions between the United States and Iran while awaiting earnings from major U.S. technology companies for further signals on artificial intelligence-related demand.

The French CAC 40 slipped 0.1%, Germany’s DAX traded marginally above flat, and the UK’s FTSE 100 edged 0.1% higher.

Kier and mining stocks lead the gainers

Construction and infrastructure specialist Kier Group (LSE:KIE) was among the session’s strongest performers after the company said it expects full-year revenue and profit to finish at the upper end of market expectations.

Mining shares also advanced as stronger copper prices supported the sector. Anglo American (LSE:AAL), Antofagasta (LSE:ANTO) and Glencore (LSE:GLEN) all posted notable gains.

Healthcare and industrial companies attract buyers

Novartis (TG:NOT) moved higher after reporting second-quarter core operating profit ahead of market forecasts.

Swedish engineering company Alfa Laval (TG:AA9) also traded higher after announcing a 35% increase in second-quarter order intake.

Julius Baer (TG:JGE) gained despite reporting that first-half profit more than doubled.

Recruiters and consumer stocks come under pressure

On the downside, recruitment firm Sthree (LSE:STEM) fell sharply after reporting a 75% decline in first-half profit, reflecting weaker hiring activity in Germany and the Netherlands.

Compass Group (LSE:CPG) also retreated despite delivering solid quarterly revenue growth.

Swiss elevator manufacturer Schindler Holding (TG:SHR) dropped to a two-month low after second-quarter sales missed expectations.

Meanwhile, watchmaker Swatch Group (LSE:0QM4) declined after first-half earnings came in below analysts’ forecasts.

Markets prepare for a crucial week of corporate results

US stock index futures moved higher on Tuesday as investors looked ahead to a wave of earnings from leading technology companies while continuing to monitor developments in the Middle East and the outlook for artificial intelligence investment.

As of 02:49 ET (06:49 GMT), Dow Jones futures were up 170 points, or 0.3%, S&P 500 futures had gained 39 points, or 0.5%, and Nasdaq 100 futures climbed 359 points, or 1.3%.

The gains followed a weaker session on Wall Street, where concerns over the long-term sustainability of AI spending weighed on sentiment. Semiconductor stocks tied to artificial intelligence surrendered much of their earlier rally, with the sector finishing only 0.6% higher after posting gains of more than 3% during the session.

Markets were also digesting increased competition from emerging Chinese AI developers, adding another layer of uncertainty to the sector.

Meanwhile, President Donald Trump signed executive orders introducing a 50% tariff on a wide range of Canadian imports, including paper products, plywood and hockey sticks. The new duties are due to take effect within 30 days.

Geopolitical uncertainty keeps investors cautious

Risk appetite remained restrained after Yemen’s Iran-backed Houthi movement threatened to block Saudi shipping, raising concerns that the regional conflict could spread further and disrupt global energy supplies.

The warning came as military exchanges between Washington and Tehran entered a tenth consecutive day despite continuing diplomatic contacts aimed at reducing tensions.

Investors also remained focused on the Strait of Hormuz and the Bab al-Mandab Strait, two critical maritime routes whose disruption could have significant implications for global oil and liquefied natural gas exports.

Oil holds above pre-war levels

Crude prices eased slightly but continued to trade well above the levels seen before the conflict escalated.

Brent crude slipped 0.1% to $89.17 per barrel, while US West Texas Intermediate gained 0.2% to $83.40.

Before hostilities intensified in late February, Brent had been trading close to $70 per barrel. Renewed geopolitical instability has kept prices elevated despite earlier ceasefire efforts.

Higher energy costs continue to raise concerns that inflation could remain stubborn, potentially influencing future monetary policy decisions.

Earnings season gathers pace

Investors are awaiting results from Charles Schwab (NYSE:SCHW), Danaher (NYSE:DHR), 3M (NYSE:MMM), Northrop Grumman (NYSE:NOC) and General Motors (NYSE:GM) before US markets open.

After the closing bell, Interactive Brokers, Chubb and Capital One are also due to report.

In Europe, Novartis (NYSE:NVS) exceeded expectations for second-quarter core operating profit as cost controls offset softer sales of Entresto. The company’s shares rose more than 1% in early trading.

Attention will quickly turn to Alphabet (NASDAQ:GOOG), Tesla (NASDAQ:TSLA) and Texas Instruments (NASDAQ:TXN), whose quarterly reports later this week are expected to provide important signals about the pace of AI-related investment.

Nvidia increases exposure to Nebius

Nvidia (NASDAQ:NVDA) disclosed a 9.3% ownership stake in AI cloud infrastructure company Nebius (NASDAQ:NBIS), following its previous $2 billion investment.

Regulatory filings showed the holding totals approximately 22.26 million shares, including shares associated with warrants that cannot be exercised before 11 September.

Nebius shares gained around 5% in after-hours trading.

Headquartered in Amsterdam, Nebius was created from the separation of Yandex and plans to build more than five gigawatts of AI computing capacity by 2030.

Defence sector gains after cabinet reshuffle

Shares in UK defence companies moved higher on Tuesday after newly appointed Prime Minister Andy Burnham named former defence secretary John Healey as the country’s new finance minister, prompting investors to reassess prospects for future military spending.

By 10:03 GMT, Babcock International (LSE:BAB) had advanced 6.4%, Qinetiq (LSE:QQ.) gained 3.8%, while BAE Systems (LSE:BA.) rose 3%.

Markets anticipate stronger defence investment

Healey left his role as defence secretary in June after criticising the previous administration over military funding, arguing that the then-prime minister had been “unable” and the Treasury “unwilling” to provide the resources necessary to safeguard the country.

According to Andrew Wishart, senior UK economist at Berenberg, Healey’s earlier resignation over defence spending “suggests that he will raise military expenditure,” although the question of how such increases would be financed “remains to be seen.”

Fiscal pressures remain a key challenge

Although Healey is regarded as a respected figure within the Labour Party, he now faces the difficult task of increasing funding for priorities such as defence while supporting economic growth, reducing welfare spending and remaining within the fiscal framework that Burnham has committed to maintaining.

While he was not widely expected to become finance minister, investors welcomed the appointment, citing his previous experience as a junior Treasury minister under Gordon Brown between 2002 and 2007, together with senior roles held under successive Labour leaders.

Earlier this month, Healey told the BBC that increased investment in defence could contribute to revitalising British industry and supporting a broader programme of reindustrialisation.

Sterling also strengthened modestly following his appointment after earlier weakness triggered by Burnham’s comments suggesting there could be some flexibility in the UK’s fiscal rules.

Canada expected to join GCAP programme

The new government is also expected to announce an important defence initiative on Tuesday by inviting Canada to participate in the Global Combat Air Programme (GCAP), the next-generation fighter aircraft project currently led by the United Kingdom, Italy and Japan.

The announcement is expected to coincide with the Farnborough International Airshow, one of the aerospace and defence industry’s leading annual events, where ongoing conflicts in Ukraine and the Middle East continue to drive demand for advanced military technologies, including combat drones, interceptor missile systems and artificial intelligence-enabled defence software.

Canada is expected to join the programme as an observer, becoming the first country outside the three founding partners to participate in the GCAP initiative.

Markets balance Middle East tensions with earnings and economic data

European equities posted modest gains on Tuesday as investors weighed renewed security concerns surrounding key Middle Eastern shipping routes against signs that diplomatic engagement between the United States and Iran remains active. Market participants also turned their attention to a busy week of corporate earnings and economic releases across Europe.

The pan-European STOXX 600 rose 0.2% in early trading. Germany’s DAX and France’s CAC 40 each advanced 0.2%, while Italy’s FTSE MIB outperformed with a 0.6% gain.

New maritime security concerns return to focus

Investor sentiment was tempered after Yemen’s Houthi movement announced plans to impose a fresh naval blockade targeting Saudi Arabia, reviving fears over the security of vital energy transport routes and the potential impact on global oil and shipping markets.

The latest development came even as reports suggested diplomatic contacts between Washington and Tehran remain ongoing following recent military confrontations. As a result, financial markets continue to weigh the possibility of easing geopolitical tensions against the growing risks facing maritime trade.

Earnings season and central bank outlook remain in focus

Corporate results also shaped early trading, with Swiss pharmaceutical company Novartis (NYSE:NVS) reporting second-quarter sales that exceeded market expectations.

Defensive sectors have attracted renewed investor interest as geopolitical uncertainty persists and attention shifts toward Thursday’s European Central Bank policy meeting, where markets will be watching closely for guidance on interest rates and the economic outlook.

Economic indicators expected to guide markets

Investors are also awaiting the latest Eurozone economic sentiment data, which could provide further insight into business confidence and the resilience of the regional economy.

In the United Kingdom, fresh wage growth figures are due shortly after newly appointed Prime Minister Andy Burnham entered office, offering policymakers and the Bank of England updated information on labour market conditions and inflation pressures.

London’s FTSE 100 traded 0.1% lower in early dealings.

Wall Street earnings remain important for European sentiment

Beyond Europe, investors are preparing for a series of earnings reports from major US technology companies, including Alphabet (NASDAQ:GOOG), Tesla (NASDAQ:TSLA) and Intel (NASDAQ:INTL), all scheduled to report later this week.

Although European equity markets have fewer mega-cap technology companies than their US counterparts, many industrial groups and semiconductor equipment manufacturers remain closely linked to American technology investment.

Any changes to capital spending plans for artificial intelligence or digital infrastructure announced by US technology leaders could have a significant impact on European technology shares.

Company movers

Among individual stocks, Mitie Group (LSE:MTO) surged 40% after agreeing to a takeover by OCS Group.

Meanwhile, Wienerberger (TG:WIB) declined 7% following the release of its latest quarterly results.