Category: Market Summary

European equities delivered a mixed performance on Monday after escalating tensions in the Middle East lifted Brent crude above $90 per barrel for the first time in a month, renewing concerns that higher energy prices could add to inflationary pressures, influence interest rate expectations and weigh on economic growth.

Market participants are also preparing for earnings reports from major U.S. technology companies and this week’s European Central Bank policy meeting. The ECB is widely expected to keep interest rates unchanged after delivering its first rate increase in almost three years on June 11.

German producer prices extend annual gains

German government bond yields climbed to their highest level in two years after fresh data showed producer prices increased for a third consecutive month in June.

According to Destatis, producer prices rose 1.8 percent year over year in June, easing from the 2.2 percent increase recorded in May.

The latest increase marked the third straight month of annual growth, supported mainly by higher intermediate goods costs and rising energy prices.

On a monthly basis, producer prices declined 0.3 percent, compared with economists’ expectations for a 0.2 percent decrease.

FTSE falls while DAX and CAC advance

The U.K.’s FTSE 100 Index fell 0.3 percent, while Germany’s DAX Index gained 0.2 percent and France’s CAC 40 Index added 0.4 percent.

In company news, budget airline Ryanair (LSE:0A2U) declined after reporting a 34 percent fall in fiscal first-quarter profit, missing analysts’ expectations.

Self-storage specialist Big Yellow Group (LSE:BYG) also traded lower after announcing first-quarter revenue growth of 3 percent.

U.S. equity futures moved modestly higher on Monday as investors monitored escalating tensions in the Middle East while preparing for a busy week of earnings from some of the world’s largest technology companies.

Dow Jones futures gained around 0.1% in early trading, while S&P 500 futures advanced 0.2%. Nasdaq 100 futures led the gains, rising 0.5% as markets looked ahead to quarterly results from several major technology names.

Wall Street ended Friday’s session lower after renewed concerns emerged over the sustainability of heavy investment in artificial intelligence. Although AI-related stocks have been a major driver of market performance this year, some investors have begun reducing exposure as valuations come under greater scrutiny.

The semiconductor sector remained under pressure, with the Philadelphia Semiconductor Index falling more than 20% from its June high, placing the benchmark in bear market territory.

Analysts at Vital Knowledge said, “For tech investors, bears won the week overwhelmingly, although the slump was more a function of narrative shift and technical dislocation (extremely crowded and complacent positioning and bullish but stale sentiment) than incrementally negative news flow.”

Geopolitical tensions keep energy markets in focus

Markets also continued to react to developments in the Middle East after the United States carried out military operations against Iran for a ninth consecutive day.

Iran reported that two oil tankers had been disabled, while the Islamic Revolutionary Guards Corps said it had targeted U.S. military assets in Jordan, Kuwait and Syria. Bahrain also activated emergency warning sirens, highlighting the growing regional tensions.

The continuing conflict has increased uncertainty over shipping through the Strait of Hormuz, a key route for global oil and liquefied natural gas exports.

Oil prices extend gains

Brent crude climbed 2.8% to $90.56 per barrel, returning above the $90 mark, while U.S. West Texas Intermediate crude rose 2.3% to $84.39 per barrel.

The renewed rally has intensified concerns that higher energy prices could fuel inflation and encourage central banks to keep interest rates elevated for longer.

Moonshot AI eyes Hong Kong IPO

Bloomberg News reported that Chinese artificial intelligence company Moonshot AI is preparing for a potential Hong Kong listing within the next six months.

The company is also said to be completing a private fundraising round that could value the business at more than $30 billion, following strong investor interest in its Kimi K3 AI model.

SpaceX targets next Starship launch

SpaceX (NASDAQ:SPCX) said it aims to conduct the thirteenth test flight of Starship on Thursday after last week’s launch attempt was called off because of engine issues.

The mission will seek to complete a successful launch, stage separation and landing while deploying Starlink V3 satellites.

FTSE 100 opens flat as oil tops $90 on Middle East tensions. Craneware contains a cyber incident while Gulf Keystone halts Shaikan production.

Market Overview

The FTSE 100 opened broadly unchanged at 10,600.27, while the Euronext 100 slipped 0.02 per cent and Germany’s DAX fell 0.16 per cent. US markets closed weaker on Friday, with the Nasdaq ending at 25,520.24 and the S&P 500 finishing at 7,457.69. Market sentiment remained under pressure as escalating US-Iran tensions drove oil prices sharply higher, while investors also looked ahead to the European Central Bank meeting and the latest US technology earnings.

Commodity markets reflected the heightened geopolitical backdrop, with Brent crude extending gains while copper, gold and natural gas were little changed. Bitcoin weakened slightly against sterling. Sterling strengthened modestly against the US dollar and Australian dollar, was broadly steady against the euro, and softened slightly against the Swiss franc and Japanese yen as investors continued to favour defensive assets.

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Market Numbers

FTSE 100: Down (0.001%), 10,600.27

Euronext 100: Down (-0.02%), 1,905.03

DAX: Down (-0.16%), 24,790.34

NASDAQ: Down, 25,520.24

S&P 500: Down, 7,457.69

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In the Headlines

Cyber security – Craneware (LSE:CRW)
Craneware said it has contained a cyber security incident, with customer-facing services remaining fully operational. The company continues to investigate the incident while maintaining business continuity, helping to limit operational and market disruption.

Production halt – Gulf Keystone Petroleum (LSE:GKP)
Gulf Keystone has temporarily suspended production at its Shaikan oil field in the Kurdistan Region of Iraq due to deteriorating regional security conditions. The move highlights the growing operational risks facing energy producers as geopolitical tensions intensify.

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Currencies (vs GBP)

USD: Up (0.00%), $1.3445

CHF: Down (-0.02%), Fr.1.087

EUR: Up (0.00%), €1.1766

JPY: Down (-0.00%), ¥218.521

AUD: Up (0.00%), $1.9266

Bitcoin (BTC/GBP): Down, £47, 599.95

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Commodities

Copper: Up

Gold: Down

Brent Crude: Up

Natural Gas: Up

European equity markets traded slightly lower on Monday as investors adopted a cautious approach ahead of a busy week featuring major U.S. technology earnings, the European Central Bank’s latest policy meeting and several key political developments in the UK.

The pan-European STOXX 600 index slipped 0.2% in early trading, extending the subdued mood that followed last week’s sharp sell-off in global technology stocks as investors reassessed artificial intelligence-related valuations.

London’s FTSE 100 fell 0.4%, while Germany’s DAX declined 0.2%. Spain’s IBEX 35 also lost 0.4% during the morning session.

Market sentiment remained under pressure as the conflict involving the United States and Iran continued, raising concerns about energy supplies and the broader economic outlook.

Brent crude climbed a further 2.2% on Monday, adding to recent gains and increasing concerns that sustained higher energy prices could reignite inflationary pressures across the eurozone.

The rise in oil prices has added another layer of uncertainty ahead of Thursday’s ECB policy meeting. While markets broadly expect policymakers to leave the benchmark interest rate unchanged at 2.25% following June’s rate increase, investors will be watching closely for any signals on the future direction of monetary policy.

Many analysts believe the recent rebound in oil and gas prices could encourage ECB President Christine Lagarde to maintain a cautious tone, leaving the possibility of further interest rate increases if inflation risks persist.

US technology earnings take centre stage

Although European stock markets have a smaller technology sector than their U.S. counterparts, many listed companies remain closely linked to spending by America’s largest technology groups.

Investors are preparing for quarterly earnings from Alphabet (NASDAQ:GOOG), Tesla (NASDAQ:TSLA) and Intel (NASDAQ:INTC), with their outlooks expected to provide important insight into demand for artificial intelligence infrastructure, semiconductors and enterprise technology spending.

The results are also likely to influence sentiment towards European suppliers operating across the semiconductor, industrial technology and engineering sectors.

Energy stocks outperform while airlines retreat

Higher crude oil prices supported gains across Europe’s energy sector, with Shell (LSE:SHEL), BP (LSE:BP.) and TotalEnergies (LSE:TTE) each rising by more than 1%.

Airline shares moved in the opposite direction as investors assessed the impact of higher fuel costs. Ryanair (LSE:0A2U) and Lufthansa (TG:LHA) both declined by more than 2%.

Among individual company movers, Segro (LSE:SGRO) fell around 1.5% after rejecting an improved takeover proposal from Prologis.

UK equities moved lower on Monday as escalating tensions between the United States and Iran weighed on investor sentiment, driving energy prices sharply higher and prompting a broad risk-off move across European markets.

The FTSE 100 fell 0.61% in early trading, while Germany’s DAX lost 0.16% and France’s CAC 40 slipped 0.05%. Sterling edged 0.08% higher against the US dollar to trade at 1.3466.

Geopolitical concerns intensified after Kuwait’s military said its air defence systems were intercepting Iranian drones, describing the attacks on social media as “sinful Iranian aggression.” The announcement followed confirmation from U.S. Central Command that it had completed a ninth consecutive night of military strikes targeting Iranian command centres, missile launch sites, coastal surveillance systems, maritime capabilities and communications infrastructure. CENTCOM said the operations were intended to “further diminish Iran’s ability to attack commercial vessels and civilian mariners transiting the Strait of Hormuz.”

Separately, UK Maritime Trade Operations issued a warning after a vessel caught fire near Kumzar, off the coast of Oman, although the cause of the incident has yet to be determined.

Speaking to reporters while returning from the FIFA World Cup final, U.S. President Donald Trump said the military action honoured fallen American service members, adding that Iran “has been very badly damaged” and had “almost lost everything militarily,” before stating, “We control the Strait, they don’t control anything.”

U.S. Secretary of State Marco Rubio told CNN that Washington was receiving “signals through multiple channels of Iran’s desire to negotiate, but there is a growing split within the regime,” while stressing that any agreement would need to be “real” and enforceable.

In the UK, Andy Burnham is expected to become prime minister on Monday after pledging to ease pressure on household finances. His position on North Sea oil policy has attracted attention after President Trump welcomed proposals to expand drilling in a Truth Social post. However, Labour deputy leader Lucy Powell told the BBC that Burnham would maintain the party’s commitment to ending new exploration licences, while supporting further development of existing fields such as Jackdaw and Rosebank.

Oil prices extended recent gains as concerns over potential disruption to shipping through the Strait of Hormuz intensified. Brent crude rose 2.35% to $90.18 a barrel, while West Texas Intermediate gained 2% to $83.40. Brent reached its highest level in more than a month following its strongest weekly advance since April.

Gold prices eased despite heightened geopolitical tensions, with gold futures slipping 0.24% to $4,009.12 an ounce and spot gold falling 0.32% to $4,004.77.

UK market highlights

Ryanair (LSE:0A2U) reported a 34% decline in first-quarter profit after weaker ticket prices and higher fuel costs offset continued growth in passenger demand.

Big Yellow Group (LSE:BYG) posted a 3% increase in first-quarter revenue, supported by higher occupancy levels and contributions from newly opened storage facilities.

Segro (LSE:SGRO) rejected an improved £13.5 billion takeover proposal from Prologis, with the board maintaining that the revised offer undervalues the business.

U.S. equity futures traded lower on Friday as investors balanced weaker-than-expected guidance from Netflix (NASDAQ:NFLX), renewed concerns over artificial intelligence spending and escalating tensions between the United States and Iran.

At 02:57 ET (06:57 GMT), Dow Jones futures were down 336 points, or 0.6%, while S&P 500 futures lost 66 points, or 0.9%. Nasdaq 100 futures led the declines, falling 488 points, or 1.7%.

Wall Street ended Thursday’s session in negative territory, with the Dow Jones Industrial Average slipping 0.2%, the S&P 500 falling 0.5% and the Nasdaq Composite retreating 1.47%.

Market attention remained firmly focused on the technology sector. Analysts at Vital Knowledge said investors continue to question the sustainability of heavy AI investment and the financial returns expected from the industry’s rapid expansion.

Vital Knowledge analysts wrote: “[T]he list of things worrying people will sound familiar to anyone following the space: the absence of free cash flow for hyperscalers/neoclouds, costs that seem to scale higher with revenue, the reliance on capital markets […] to fund capex […], the huge pipeline of debt/equity supply that’s washing over markets, the increasingly poor financial/fundamental prospects for bleeding edge frontier labs […], and questions about data center overcapacity.”

Netflix guidance disappoints investors

Netflix (NASDAQ:NFLX) fell more than 8% in extended trading after issuing third-quarter guidance that failed to meet market expectations.

The streaming company forecast earnings per share of $0.82, below analysts’ consensus of $0.84, while expected revenue of $12.86 billion also missed estimates of $13.0 billion.

Despite the softer guidance, Netflix told investors that its business “remains solid” and said it is “on track to meet our objectives for the year.”

The company also confirmed that, beginning in January 2027, viewing-hours data will be published annually instead of twice each year, continuing its strategy of placing greater emphasis on financial performance rather than engagement metrics.

Earnings season continues

Investors are also preparing for fresh quarterly updates from The Travelers Companies (NYSE:TRV), Truist Financial Corporation (NYSE:TFC), Fifth Third Bancorp (NASDAQ:FITB) and Regions Financial Corporation (NYSE:RF).

According to Vital Knowledge, management commentary across corporate America has remained broadly constructive despite concerns surrounding AI spending, energy markets and geopolitical uncertainty.

Recent U.S. economic data have also remained supportive, with resilient retail sales, lower jobless claims, stronger regional manufacturing activity and softer-than-expected inflation readings.

Oil rises as conflict escalates

Military exchanges between the United States and Iran continued for a sixth consecutive day, with both sides launching new strikes.

U.S. Central Command said its latest operations were designed to weaken Iranian military capabilities while “holding Iran accountable” for attacks on commercial shipping.

Iranian media reported damage to civilian infrastructure, including bridges and a railway station, while renewed uncertainty surrounding shipping through the Strait of Hormuz supported oil prices.

Brent crude gained 0.7% to $84.81 per barrel, while West Texas Intermediate rose 1.0% to $79.76.

SpaceX postpones Starship test

SpaceX (NASDAQ:SPCX) delayed the launch of its Starship rocket after several engines failed to ignite properly during the countdown in Texas.

Chief Executive Elon Musk suggested another launch attempt could take place next week. Shares fell more than 4% in after-hours trading following the announcement.

Markets opened cautiously as Middle East tensions weighed on sentiment. Burberry and Wise reported strong updates while Brent crude moved higher.

Market Overview

The FTSE 100 opened broadly unchanged at 10,572.39, while the Euronext 100 slipped 0.14 per cent and Germany’s DAX fell 0.53 per cent at the open. Overnight, the Nasdaq closed lower at 25,881.95 and the S&P 500 finished at 7,533.77, with both US benchmarks declining as investors reacted to renewed US-Iran tensions. Market sentiment remained cautious amid geopolitical uncertainty, although stronger corporate earnings helped limit losses across European markets.

Macro sentiment was shaped by firmer energy prices as Brent crude advanced on escalating Middle East tensions and concerns over potential disruption to Red Sea shipping. Gold edged higher on safe-haven demand, copper weakened, and natural gas eased slightly. Against sterling, the US dollar, Swiss franc and euro strengthened marginally, while the Japanese yen and Australian dollar were little changed. Bitcoin was down.

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Market Numbers

FTSE 100: Up (0.001%), 10,572.39

Euronext 100: Down (-0.14%), 1,917.90

DAX: Down (-0.53%), 24,783.56

NASDAQ: Down, 25,881.95

S&P 500: Down, 7,533.77

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In the Headlines

Luxury Retail – Burberry Group (LSE:BRBY)

Burberry reported a 5 per cent rise in first-quarter comparable sales as strong demand in the Americas and China offset weaker trading across Europe. The update suggests the group’s turnaround efforts are gaining traction despite uneven regional consumer spending.

Fintech Growth – Wise plc (LSE:WSE)

Wise delivered strong first-quarter FY27 growth as customer numbers and cross-border payment volumes continued to increase. The performance highlights ongoing demand for low-cost international money transfers and supports confidence in the company’s long-term growth strategy.

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Currencies (vs GBP)

USD: Up (0.03%), $1.3478

CHF: Up (0.02%), Fr.1.0897

EUR: Up (0.02%), €1.1776

JPY: Up (0.01%), ¥218.8535

AUD: Unchanged (0.00%), $1.9253

Bitcoin (BTC/GBP): Down, £46,662.10

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Commodities

Copper: Down

Gold: Up

Brent Crude: Up

Natural Gas: Down

European equity markets moved lower on Friday as renewed military escalation in the Middle East lifted oil prices and revived inflation concerns. Even so, a solid start to the second-quarter earnings season helped limit losses, leaving major indexes on course to finish the week in positive territory.

The pan-European STOXX 600 slipped 0.6% during early trading but was still on track for a weekly advance of around 0.4%. Strong corporate results, particularly from leading banking groups, have supported investor sentiment throughout the week and helped cushion the broader market.

Investor confidence was challenged after the United States and Iran exchanged military strikes for a sixth consecutive day. The latest escalation pushed crude oil prices sharply higher, fuelling concerns that sustained energy inflation could slow the global disinflation process and complicate future monetary policy decisions by major central banks.

Despite the geopolitical backdrop, European markets proved more resilient than their Asian counterparts, where technology stocks led a much steeper sell-off overnight. Europe’s comparatively smaller exposure to mega-cap technology companies helped limit the downside.

Within the semiconductor sector, STMicroelectronics (BIT:STMMI) declined 5%, while ASML (EU:ASML) fell 3.5%.

Investors continued to focus on encouraging corporate earnings and signs of easing inflation in the United States earlier this week, both of which helped reduce immediate concerns over higher global interest rates despite the worsening geopolitical environment.

Attention is now turning to next week’s European Central Bank policy meeting.

Most economists expect the ECB to leave its benchmark deposit rate unchanged. However, the recent jump in oil prices has led money markets to increase expectations that interest rates could move higher later if inflationary pressures persist.

The central bank is expected to balance weakening economic growth across the eurozone against the risk that higher energy costs could generate fresh inflationary pressures.

Across Europe’s major markets, London’s FTSE 100 fell 0.3% but remained on course for a weekly gain, supported by banking shares. France’s CAC 40 declined 0.6%, Germany’s DAX eased 0.5%, while Italy’s FTSE MIB lost 1% and Spain’s IBEX 35 slipped 0.3% as investors reduced exposure to risk assets.

Among individual companies, Danske Bank (TG:DSN) declined 2.5% following the release of its latest quarterly results.

London equities came under pressure on Friday after giving up early gains, as a sixth consecutive night of U.S. military strikes on Iran weighed on global risk appetite. The cautious mood followed broad declines across Asian markets, prompting investors to move away from risk assets.

At 03:17 ET (07:17 GMT), the FTSE 100 was 0.05% higher, although gains proved fragile. Germany’s DAX declined 0.42%, while France’s CAC 40 fell 0.53%. Sterling eased 0.03% against the U.S. dollar to $1.3472.

Asian markets endured a sharp sell-off led by Japan, where the Nikkei 225 dropped 3.96% and the TOPIX lost 2.72%. Semiconductor shares came under pressure despite a positive long-term outlook from TSMC.

In Taiwan, TSMC recovered from earlier losses to close 1.23% higher as investors assessed the company’s increased capital expenditure guidance alongside broader concerns over artificial intelligence spending.

Chinese equities also weakened. The Shanghai Composite declined 3.05%, the CSI 300 fell 3.60%, and Hong Kong’s Hang Seng Index closed 2.1% lower.

Geopolitical tensions intensified after U.S. Central Command confirmed it had completed a sixth straight night of strikes against Iran. CENTCOM said fighter aircraft, drones and warships targeted “dozens” of military sites, adding that more than 50,000 U.S. personnel are now deployed across the region.

The latest military action follows the collapse of a 14-point memorandum of understanding agreed in June.

Iranian state media reported that overnight strikes hit an airport, railway station and bridges in Hormozgan province near Bandar Abbas. Casualty reports varied, with state television initially reporting three deaths and nine injuries before other state outlets later revised the death toll to “at least seven” while maintaining that nine people were wounded.

Iran responded by targeting U.S. military infrastructure in Kuwait, Bahrain and Qatar. Kuwait’s military said it was “confronting attacks by hostile drones” from Iran, although no confirmed damage to U.S. facilities was reported.

Speaking on Thursday, U.S. President Donald Trump said the United States was “winning big” in Iran and that Americans would see “the fruits” of the campaign “very, very shortly,” although he did not provide further details during his televised address on election security.

Earlier in the day, White House press secretary Karoline Leavitt said Iran “very much continues to talk” with Washington despite the ongoing strikes, which she said were carried out in response to Iran attacking commercial vessels in breach of the June agreement.

Commodity markets reflected the heightened geopolitical uncertainty. Brent crude rose 0.33% to $84.50 a barrel, while U.S. West Texas Intermediate crude gained 0.73% to $79.52. Spot gold advanced 0.56% to $3,998.72 an ounce, with gold futures adding 0.26% to $4,002.32.

UK market round-up

Wise (LSE:WSE) reported a 25% increase in first-quarter net revenue, supported by continued growth in cross-border payment volumes and customer balances. The fintech group also reaffirmed its guidance for the full financial year.

Burberry (LSE:BRBY) posted 5% growth in first-quarter comparable store sales, matching market expectations as robust demand in the United States offset weaker consumer spending across Europe and the Middle East amid ongoing regional tensions.

U.S. equity futures traded lower ahead of Thursday’s opening bell, with investors taking a more cautious stance after two consecutive days of gains as renewed geopolitical risks and weakness in technology stocks weighed on sentiment.

Nasdaq 100 futures led the declines, reflecting broad selling pressure across the semiconductor sector.

TSMC drops despite strong quarterly results

Taiwan Semiconductor (NYSE:TSM) was among the biggest movers before the open, with its U.S.-listed shares falling 4.4%.

Although the chipmaker reported second-quarter earnings ahead of expectations, investors focused on the company’s plans to significantly increase capital spending.

“While the case for boosting capacity is clear at a time when there is a large gap between supply and demand, shareholders will want TSMC to retain some discipline even as it looks to meet orders piling up,” said AJ Bell head of markets Dan Coatsworth.

Oil climbs as conflict intensifies

Energy markets also remained in focus as U.S. crude futures climbed back above $80 per barrel following another round of military action between the United States and Iran.

Washington carried out fresh strikes on Iranian targets overnight, while Tehran responded with attacks on U.S. military bases in Gulf nations and warned it could strike “all the infrastructure in the region” if President Donald Trump proceeds with threats against Iranian energy and transport infrastructure.

Inflation data boosts hopes for steady interest rates

Wednesday’s market gains were driven by softer-than-expected producer inflation data.

The Producer Price Index fell 0.3% in June, compared with expectations for a smaller decline, while annual producer inflation slowed to 5.5%.

The latest figures followed weaker consumer inflation data earlier in the week, reinforcing expectations that the Federal Reserve may keep interest rates unchanged.

“Traders are rapidly retreating from rate-hike bets,” FHN Financial Chief Economist Chris Low said. “Fed funds futures see the odds of a hike this month now at 9% and have a hike fully priced in by December. Yesterday, it was September.”

Investors monitor earnings and geopolitics

Despite easing inflation pressures, investors remained focused on the escalating conflict in the Middle East.

President Donald Trump told Fox News that the United States could target Iranian power plants and bridges next week “unless they get to the table and negotiate.”

Brokerage and airline stocks outperformed during Wednesday’s session, while semiconductor, networking and computer hardware companies lagged behind the broader market as investors rotated away from technology.