Category: Market Summary

European equity markets were mixed on Tuesday, with investors sifting through a fresh wave of quarterly results from some of the region’s largest corporates, set against a backdrop of improving global risk appetite.

By 08:05 GMT, Germany’s DAX was down 0.2% and the UK’s FTSE 100 had slipped 0.2%, while France’s CAC 40 was outperforming, up 0.3%.

Global risk appetite improves

Confidence has firmed across global equity markets, supported by a rebound in technology and artificial intelligence-related stocks following last week’s sell-off.

U.S. markets extended their rally for a second consecutive session, with the Dow Jones Industrial Average reaching a new all-time high. In Asia, Japan’s Nikkei 225 closed at a record level after Prime Minister Sanae Takaichi secured a landslide victory in the Lower House.

European indices have also started the year positively, with the DAX and CAC 40 both up more than 2% year to date and the FTSE 100 gaining over 4%, helped by generally supportive corporate earnings.

Earnings updates dominate

The flow of company results continued on Tuesday as the reporting season gathered pace.

Philips (EU:PHIA) delivered a better-than-expected fourth quarter, reporting sales of €5.10bn as the Dutch health technology group benefited from broad-based demand despite the impact of higher tariffs.

Kering (EU:KER) said fourth-quarter sales fell by slightly less than anticipated, as new chief executive Luca de Meo worked to stabilise the luxury group in his first quarter at the helm.

AstraZeneca (LSE:AZN) forecast growth in both revenue and profit for 2026, citing continued demand for its cancer therapies and newer medicines as it expands further in the United States and China.

Barclays (LSE:BARC) reported a 12% rise in annual profit and set out new performance targets through to 2028, as the lender focuses on its core UK market and increased use of technologies such as AI to reduce costs.

On the downside, BP (LSE:BP.) announced it would suspend share buybacks and redirect surplus cash toward strengthening its balance sheet. The move followed a fourth-quarter loss of $3.4bn, compared with a $1.2bn profit in the previous quarter.

UK political uncertainty in focus

The European economic calendar was relatively light, with the main data point showing France’s unemployment rate rising to 7.9% in the fourth quarter from 7.7% in the prior three months.

Investor attention in the UK is likely to remain fixed on domestic politics, as Prime Minister Keir Starmer faces mounting pressure amid ongoing controversy surrounding the appointment of Peter Mandelson as ambassador to the United States.

Anas Sarwar, leader of the Scottish Labour Party, called on the prime minister to resign on Monday, a request Starmer rejected, following renewed scrutiny of Mandelson’s links to the late US sex offender Jeffrey Epstein.

According to Ruth Gregory, deputy chief UK economist at Capital Markets, any replacement of Starmer and/or Chancellor Rachel Reeves could initially push gilt yields higher and weaken sterling. Over the longer term, she said “the most likely longer-lasting influence is a loosening in fiscal policy that leads to higher gilt yields than otherwise and a weaker pound than otherwise.”

Oil edges lower as geopolitical risks persist

Oil prices eased slightly on Tuesday, although tensions between the United States and Iran remained elevated, keeping concerns about potential supply disruptions from the Middle East firmly in place.

Brent crude futures slipped 0.3% to $68.86 a barrel, while U.S. West Texas Intermediate crude fell 0.3% to $64.18 a barrel. Both benchmarks had gained more than 1% on Monday after the U.S. Department of Transportation’s Maritime Administration advised U.S.-flagged vessels to keep their distance from Iranian waters when transiting the Strait of Hormuz and the Gulf of Oman.

Roughly one-fifth of the world’s oil consumption passes through the Strait of Hormuz between Oman and Iran, making any escalation in the region a significant risk to global energy supplies.

The warning came despite signs of progress in recent weekend talks between Washington and Tehran, with both sides agreeing to continue discussions over Iran’s nuclear programme.

European equities traded mostly higher on Monday as concerns around the technology sector subsided and a series of merger-and-acquisition headlines helped buoy investor confidence.

The macroeconomic calendar was relatively quiet, though the latest KPMG/REC Report on Jobs showed that permanent job placements in the U.K. fell again in January amid subdued demand and employer worries over costs. That said, the rate of decline slowed to its mildest pace in 18 months, offering a small note of reassurance.

By mid-morning, the U.K.’s FTSE 100 was down 0.2%, while France’s CAC 40 edged up 0.1% and Germany’s DAX gained 0.5%.

Italy’s banking sector provided notable upside, with UniCredit (BIT:UCG) jumping after posting a record net profit of €10.6 billion for 2025.

In the technology space, STMicroelectronics (BIT:STMMI) surged after announcing an expanded strategic partnership with Amazon Web Services.

Deal news also drove sharp moves elsewhere. Shares in InPost (EU:INPST) rallied strongly after a consortium led by Advent, alongside FedEx, agreed to acquire the Polish parcel locker group at €15.60 per share.

In the healthcare sector, Novo Nordisk (NYSE:NVO) climbed after U.S. telehealth group Hims & Hers said it would withdraw its copycat weight-loss pill from the market.

Not all stocks joined the rally, however. NatWest (LSE:NWG) shares moved lower after the British lender announced a deal to acquire private equity-backed wealth manager Evelyn Partners.

European equities moved modestly higher on Monday, kicking off a packed week that features a fresh round of corporate earnings alongside a series of high-impact economic data releases.

By 08:05 GMT, Germany’s DAX was up 0.5%, France’s CAC 40 had added 0.1%, and the UK’s FTSE 100 was trading 0.2% higher.

UniCredit sets the tone for bank earnings

The European earnings season is gaining momentum, with several large-cap names and major banks due to report in the days ahead. The pan-European Stoxx 600 index is hovering close to record levels, having logged seven positive weeks out of the past eight, as quarterly results have generally been well received.

UniCredit (BIT:UCG) was a standout, after reporting record net profit of €10.6 billion for 2025, representing a 14% increase year on year. Italy’s second-largest lender also outlined ambitious medium-term goals, targeting €13 billion in net profit by 2028 and committing to €30 billion of shareholder returns over the next three years.

The bank has deployed several billion euros from its surplus capital to build significant stakes in Germany’s Commerzbank and Greece’s Alpha Bank, stopping short of full acquisitions but positioning itself as a key shareholder in both institutions.

This week also brings results from Commerzbank (TG:CBK), alongside UK peers Barclays (LSE:BARC) and NatWest Group (LSE:NWG).

Beyond the banking sector, earnings updates are due from a wide range of blue-chip companies, including Koninklijke Philips (EU:PHIA), AstraZeneca (LSE:AZN), TotalEnergies (EU:TTE), Heineken (EU:HEIA), Mercedes-Benz Group (TG:MBG), Siemens (TG:SIE) and L’Oreal (EU:OR).

U.S. data in focus

Away from company results, investors will also be digesting fresh growth figures from both the eurozone and the UK. The main attention, however, is on the United States, where several key economic indicators are due after being delayed by a brief government shutdown.

January’s nonfarm payrolls report and consumer price index data are scheduled for later in the week, and will be closely watched for insight into the resilience of the U.S. economy. The releases follow the nomination of Kevin Warsh as the next chair of the Federal Reserve, adding further significance to the data.

Oil prices ease on diplomatic signals

Oil prices edged lower on Monday after the U.S. and Iran agreed to continue negotiations over Tehran’s nuclear programme, easing concerns about potential supply disruptions in the Middle East.

Brent crude futures slipped 0.9% to $67.46 a barrel, while U.S. West Texas Intermediate fell by the same margin to $62.98 a barrel. Both benchmarks declined by more than 2% last week, marking their first weekly drop in seven weeks, as geopolitical tensions showed signs of cooling.

Officials from both countries said indirect talks held in Oman on Friday would continue, reducing fears of a military escalation in a region that plays a critical role in global oil supply.

U.S. equity futures were modestly higher at the start of the week, as investors prepared for a heavy run of corporate earnings and closely watched economic releases that had been delayed. Semiconductor group Onsemi is among the first major names due to report on Monday, while Japanese equities climbed after Prime Minister Sanae Takaichi secured a decisive election victory.

Futures edge higher

Wall Street futures pointed slightly upward early Monday ahead of a week packed with earnings updates and key macro data. By 03:43 ET, Dow futures were up 87 points, or 0.2%, S&P 500 futures had added 6 points, or 0.1%, and Nasdaq 100 futures were ahead by 13 points, also 0.1%.

The move followed a strong finish to last week, when U.S. stocks rebounded from earlier losses driven by concerns that artificial intelligence could disrupt parts of the software sector. On Friday, the Dow Jones Industrial Average closed above the 50,000 mark for the first time, while the S&P 500 gained nearly 2% and the Nasdaq Composite advanced around 2.2%.

Not all mega-cap stocks participated in the rally. Shares of Amazon (NASDAQ:AMZN) fell 5.6% as investors reacted cautiously to signals that the company plans to significantly ramp up spending on AI. Other large technology groups, including Alphabet (NASDAQ:GOOG), have also outlined aggressive investment plans to remain competitive in AI, though questions persist over how quickly these investments will deliver sustainable returns.

ON Semi to report

Earnings attention on Monday turns to ON Semiconductor (NASDAQ:ON), which is set to release quarterly results after the closing bell. The chipmaker previously issued fourth-quarter revenue and profit guidance broadly in line with market expectations.

Demand for ON Semi’s power management solutions used in AI data centres has helped offset softer conditions in the automotive sector, where weaker electric vehicle demand in North America and Europe has reduced spending on silicon carbide components.

Consensus estimates compiled by Bloomberg suggest adjusted earnings per share of $0.63 on revenue of $1.53 billion.

Later in the week, investors will also hear from a number of other technology-focused companies, including Datadog (NASDAQ:DDOG), Spotify (NYSE:SPOT), Cisco (NASDAQ:CSCO) and Applied Materials (NASDAQ:AMAT).

Japan PM scores big win

Outside the U.S., Asian markets advanced after Japanese Prime Minister Sanae Takaichi secured a major victory in a snap election held over the weekend. The vote came just 110 days after Takaichi became Japan’s first female prime minister, making the gamble a high-stakes one.

According to reports, her Liberal Democratic Party won such strong support that it achieved a rare supermajority in the lower house of parliament. The outcome appears to clear the way for Takaichi to pursue plans for increased government spending and tax cuts, supported by what observers see as a stable political environment.

“Calm may be on the way for Japan’s markets now the election is out of the way,” said Thomas Mathews, Head of Asia Pacific Markets at Capital Economics. He added that a recent sell-off in Japanese government bonds, which had unsettled global markets, is unlikely to persist, while the yen is expected to strengthen.

Gold rises

Gold prices moved higher in European trading, with silver also advancing, following sharp swings in precious metals markets last week. Those moves were driven by a mix of subdued safe-haven demand, profit-taking and uncertainty around the outlook for U.S. monetary policy.

Investors are now focused on several key U.S. economic indicators due this week, notably nonfarm payrolls and consumer price index inflation data. Both releases are closely watched by the Federal Reserve when assessing the path for interest rates.

Some haven demand eased after signs of progress in talks between the U.S. and Iran over the weekend, with both sides indicating a willingness to continue discussions on Tehran’s nuclear programme.

Oil slips

Oil prices declined as easing geopolitical tensions weighed on sentiment. Comments from Washington and Tehran suggesting that indirect nuclear negotiations will continue helped reduce fears of an imminent escalation in the Middle East.

A firm U.S. dollar ahead of major economic data releases also pressured crude prices, which had already fallen about 2% last week. Investors are also awaiting fresh economic data from China, the world’s largest oil importer.

Brent futures were last down 1.1% at $67.32 a barrel, while West Texas Intermediate crude slipped 1.0% to $62.92 a barrel.

The U.S. and Iran said over the weekend that talks held in Oman on Friday were constructive and would continue, helping to temper concerns of military conflict after earlier U.S. naval deployments to the region.

UK equities moved higher at the start of the week, tracking gains across European markets, while sterling eased slightly against the U.S. dollar in early trading.

By 08:12 GMT, the FTSE 100 was up 0.4%, while the pound slipped 0.07% versus the dollar to 1.3603. European markets also posted solid gains, with Germany’s DAX rising 0.8% and France’s CAC 40 adding 0.4%.

UK market round-up

Plus500 Ltd (LSE:PLUS) was in focus after the trading platform said it expects its 2026 performance to come in ahead of market expectations, following stronger-than-anticipated results for 2025. Growth was supported by institutional partnerships linked to U.S. prediction markets and increasing exposure to higher-value customers. The group reported full-year revenue of $792.4 million, up 3% year on year, while net profit also increased 3% to $281.3 million. Basic earnings per share rose 10% to $3.93 from $3.56.

In the banking sector, NatWest Group PLC (LSE:NWG) announced an agreement to acquire wealth manager Evelyn Partners for £2.7 billion. The deal will merge Evelyn’s £69 billion of assets under management with NatWest’s existing £59 billion, creating a combined £127 billion in assets under management and administration. NatWest also unveiled a £750 million share buyback alongside the transaction.

Elsewhere, Phoenix Global Mining Ltd (LSE:PXC) confirmed the immediate suspension of Executive Chairman Marcus Edwards-Jones and Chief Financial Officer Richard Wilkins. The board is investigating allegations relating to their recent conduct and historic payments made to Lloyd Edwards-Jones S.A.S., the company’s former corporate finance adviser.

In the advertising sector, WPP is reportedly preparing to combine its three main creative agencies under a single brand, according to the Financial Times, as part of a wider effort to simplify its operating structure.

On the regulatory front, the UK’s Financial Conduct Authority said it plans to publish more comprehensive trading data for London-listed shares in a bid to address what it sees as significant under-reporting of market liquidity. The regulator is considering collecting data from all trading venues, including exchanges, dark pools and off-exchange platforms, to present a fuller picture of UK market activity. Simon Walls, the FCA’s interim director of markets, told the Financial Times that current liquidity measures can be misleading because they rely heavily on London Stock Exchange order book data while excluding a substantial volume of trading activity elsewhere.

European equities pushed higher on Friday, regaining ground after ending the previous session largely in negative territory.

Germany’s DAX advanced about 0.5%, while the UK’s FTSE 100 rose 0.2% and France’s CAC 40 edged 0.1% higher as investors weighed fresh economic data alongside company-specific news.

On the macro front, figures from Destatis showed German industrial production fell sharply in December, sliding 1.9% month on month after a 0.2% increase in November. The decline was significantly steeper than expectations for a modest 0.2% drop. On an annual basis, output contracted by 0.6%, reversing a 0.5% rise recorded the previous month.

In France, data from the customs office indicated a widening trade gap at the end of the year. The country’s foreign trade deficit increased to €4.8 billion in December from €4.0 billion in November, exceeding forecasts for a shortfall of around €4.1 billion, as imports outpaced exports.

At the stock level, Vinci (EU:DG) shares jumped after the infrastructure and construction group reported full-year results that exceeded market expectations. Vinci posted net income attributable to shareholders of €4.90 billion for 2025, or €8.65 per share, up from €4.86 billion, or €8.43 per share, a year earlier.

By contrast, Metlen Energy & Metals (LSE:MTLN) came under heavy pressure after warning that its 2025 EBITDA is now expected to be around 25% lower than previously targeted, despite what it described as solid performance across its core business divisions.

European stock markets were mostly weaker on Friday, with investors continuing to digest a heavy run of corporate results as a packed week—featuring major central bank decisions—neared its end. By mid-morning, Germany’s DAX was up 0.3%, while France’s CAC 40 slipped 0.3% and the UK’s FTSE 100 eased 0.2%.

Earnings remained the main focus across the region, with updates from several large-cap names shaping sentiment. Shares in Stellantis (BIT:STLAM) dropped sharply after the carmaker announced it expects to book around €22.2 billion in charges as it scales back its electric vehicle strategy in response to softer demand. The group said the bulk of the write-downs relate to revisions to its product roadmap, reflecting much lower assumptions for EV sales. Following the reset, Stellantis now anticipates a net loss of €19–21 billion in the second half of 2025 and confirmed that dividend payments will be suspended.

Elsewhere in the banking sector, Société Générale (EU:GLE) lifted its profitability target for the year after reporting a stronger-than-expected fourth-quarter performance, supported by higher revenues and tighter cost control. In Italy, utility group Enel (BIT:ENEL) said its 2025 ordinary net income came in slightly above the top end of guidance at €6.90 billion, ahead of a capital markets day scheduled for later this month.

Other notable movers included weight-loss drugmaker Novo Nordisk (NYSE:NVO), whose shares rose after the US Food and Drug Administration warned it could take action against “illegal copycat drugs.” In the mining sector, Rio Tinto (LSE:RIO) and Glencore (LSE:GLEN) confirmed late Thursday that they had ended discussions over a potential megamerger that would have created the world’s largest mining company.

On the macro front, fresh data underlined the uneven nature of Germany’s economic recovery. Exports jumped 4.0% month on month in December, well ahead of expectations for a 1% rise, but industrial production disappointed, falling 1.9% over the same period. In the UK, figures from mortgage lender Halifax showed house prices rose 0.7% in January and were 1.0% higher than a year earlier.

Central banks were also in focus, with both the European Central Bank and the Bank of England leaving interest rates unchanged on Thursday, in line with market expectations.

In commodities, oil prices edged higher on Friday but remained on track for their first weekly decline in almost two months. Brent crude rose 1.3% to $68.43 a barrel, while US West Texas Intermediate gained 1.4% to $64.20. Despite the rebound, Brent was heading for a weekly loss of 3.3% and WTI for a drop of 1.8%, as traders weighed the outcome of US-Iran talks scheduled for later in the day.

Markets have been hopeful that discussions between Washington and Tehran could help ease tensions in the Middle East and reduce the risk of wider conflict. That optimism has led investors to strip some geopolitical risk premium out of crude prices this week, despite Iran’s status as a major oil producer and its proximity to the strategically vital Strait of Hormuz.