Category: Top Story

European equity markets began the week on a cautious footing on Monday, with investors reluctant to take strong positions amid lingering geopolitical uncertainty, an upcoming Federal Reserve policy decision and a packed schedule of corporate earnings.

By 08:05 GMT, Germany’s DAX was up 0.1% and the UK’s FTSE 100 added 0.2%, while France’s CAC 40 edged 0.1% lower.

U.S.–Canada tensions remain elevated

While recent concerns around U.S. President Donald Trump’s stance on Greenland and the risk of a transatlantic trade dispute appear to have eased, broader geopolitical risks remain in focus.

Over the weekend, Trump warned that the U.S. would impose a 100% tariff on Canada should Ottawa strike a trade agreement with China. Canadian Prime Minister Mark Carney responded by saying Canada has no plans to pursue a free trade deal with China, though the exchange highlighted ongoing friction between the two neighbouring countries.

German Ifo data takes back seat to Fed meeting

Europe’s key data release on Monday is the German Ifo business climate survey, which is expected to signal improving corporate sentiment in the eurozone’s largest economy.

Even so, market attention is firmly centred on the U.S. Federal Reserve’s two-day policy meeting, which concludes on Wednesday. Investors widely expect interest rates to be left unchanged following three consecutive cuts, and will scrutinise the Fed’s statement and comments from Chair Jerome Powell for guidance on the future direction of monetary policy.

Corporate focus: Ryanair and S4 Capital

In company news, Ryanair (LSE:0A2U) said it expects full-year profit after tax to be roughly one-third higher than last year, supported by stronger-than-expected fare growth. Average fares are now forecast to rise by more than the 7% annual increase projected in November.

That said, third-quarter profit fell sharply compared with a year earlier, largely due to an €85 million charge linked to a fine imposed by Italy’s competition authority.

Meanwhile, digital advertising group S4 Capital (LSE:SFOR) said its full-year 2025 trading performance has exceeded both the revised guidance issued in November and current market expectations.

Across the Atlantic, Wall Street is set for a heavy earnings week, with more than 90 S&P 500 companies due to report, including Apple (NASDAQ:AAPL), Meta Platforms (NASDAQ:META) and Microsoft (NASDAQ:MSFT). So far this reporting season, 76% of companies have beaten expectations, according to FactSet data.

Oil prices consolidate after recent rally

Oil prices edged slightly lower on Monday, pausing after recent gains driven by renewed tensions between the U.S. and Iran and severe winter weather across parts of the United States.

Brent crude slipped 0.2% to $64.92 a barrel, while U.S. West Texas Intermediate fell 0.2% to $60.93. Both benchmarks rose 2.7% last week, finishing Friday at their highest levels since January 14.

On Thursday, Trump said the U.S. had an “armada” heading toward Iran, one of the Middle East’s largest oil producers, with a U.S. aircraft carrier strike group and additional military assets expected to arrive in the region in the coming days.

Separately, winter storms in the U.S. disrupted crude oil and natural gas production and drove sharp increases in spot power prices.

UK equities opened little changed on Monday after a volatile previous week that was unsettled by tariff threats from U.S. President Donald Trump linked to Greenland. Sterling strengthened above $1.36, while major European markets showed mixed early moves.

By 09:05 GMT, the FTSE 100 was flat, while the pound rose 0.2% against the dollar to trade at 1.3670. On the continent, Germany’s DAX edged up 0.1%, while France’s CAC 40 slipped 0.1%.

UK round-up

Ryanair Holdings PLC (LSE:0A2U) reported a sharp fall in third-quarter profit, weighed down by a sizeable penalty from Italian regulators. The budget airline posted profit after exceptional items of €30 million for the quarter ended December 31, down 80% from €149 million a year earlier. Ryanair said the decline was driven by an €85 million charge linked to a fine imposed by Italy’s competition authority.

In separate updates, S4 Capital PLC (LSE:SFOR) said its full-year 2025 trading performance came in ahead of both its revised guidance issued in November and current market expectations. The digital marketing group exceeded forecasts for £664 million of net revenue and £75 million of operational EBITDA, delivering an EBITDA margin of around 12% despite an 8.5% fall in like-for-like net revenue.

Meanwhile, infrastructure specialist Costain Group (LSE:COST) said its FY25 adjusted operating profit was in line with market forecasts. Net cash increased to £190 million, ahead of the £171 million consensus estimate, while adjusted operating margins exceeded the group’s 4.5% run-rate target. Costain noted solid trading through the year, with second-half revenue expected to match the £525 million recorded in the first half as projects reached completion.

Elsewhere, shares in Spire Healthcare Group (LSE:SPI) jumped more than 16% after the hospital operator confirmed it is in early-stage discussions with private equity firms. The company named Bridgepoint Advisers Limited and Triton Investment Advisers LLP as parties involved in talks under a strategic review announced in September.

UK equities traded higher on Friday morning, bucking a broader decline across European markets, as investors reacted to stronger-than-expected retail sales figures ahead of the Bank of England’s upcoming interest rate decision.

By 0823 GMT, the FTSE 100 was up 0.3%, while sterling edged slightly lower, with GBP/USD down 0.04% at 1.3488. In contrast, continental markets remained under pressure, with Germany’s DAX and France’s CAC 40 both slipping 0.1%.

UK roundup

UK retail sales rose 0.4% month on month in December, rebounding from a decline in November, according to figures released Friday by the Office for National Statistics. The increase comfortably exceeded economists’ expectations for flat growth. On an annual basis, sales climbed 2.5%, accelerating from a revised 1.8% rise in November and well ahead of the 1.0% forecast.

In company news, C&C Group plc (LSE:CCR) revised down its profit expectations for the 2026 financial year, now guiding for adjusted operating profit of between €70 million and €73 million. The drinks producer pointed to subdued consumer confidence following the UK’s November Budget, which weighed on customer activity in November and early December.

Elsewhere, Babcock International Group (LSE:BAB) said on Thursday that strong organic revenue growth continued through the third quarter, leaving the defence contractor on track to achieve its full-year operating margin target of 8%. The group also confirmed that chief executive David Lockwood will retire, with a successor already chosen from within its Nuclear division.

Asset manager Record plc (LSE:REC) reported that assets under management increased to $115.9 billion at the end of December, up from $110.3 billion at the end of September. The company said the rise was driven by positive net inflows and growth in underlying assets, partly offset by foreign exchange movements.

In executive updates, Pets at Home Group Plc (LSE:PETS) confirmed that Sarah Pollard will join the group as chief financial officer designate on March 23, 2026. She will succeed Mike Iddon, who is set to step down from the board on March 27, 2026, when Pollard will formally assume the roles of CFO and executive director.

A long-running dispute over Ben & Jerry’s social mission and governance intensified this week after The Magnum Ice Cream Company (LSE:MICC) accused the ice cream brand’s former board chair of misconduct and disclosed that Ben & Jerry’s board has been reduced from eight directors to just two.

Magnum became Ben & Jerry’s parent company in December, when Unilever spun off its ice cream division into the newly listed group, while retaining a 19.9% ownership stake. Unilever originally acquired the Vermont-based, socially focused ice cream maker in 2000.

Since 2024, Ben & Jerry’s and its independent board have been locked in legal proceedings against Unilever — and now Magnum — in a U.S. District Court in New York. The lawsuit alleges that the parent companies sought to erode the brand’s progressive social mission and weaken the independence of its board.

In a court filing dated January 20, Magnum said that only Ben & Jerry’s chief executive and a Unilever-appointed director now remain on the board. Former board chair Anuradha Mittal was removed in mid-December after Magnum determined she was no longer fit to serve, while two veteran directors stepped down following the introduction of nine-year term limits.

According to the filing, Magnum said Mittal “had engaged in serious misconduct that rendered her ineligible to serve on the board” and cited an Ernst & Young audit of the Ben & Jerry’s Foundation — a separate U.S. nonprofit funded by the brand — which raised concerns over potential conflicts of interest.

Magnum also said that the three remaining independent directors failed to certify compliance with its code of business integrity and declined to undergo mandatory compliance training, resulting in their departure from the board as of January 1. The company added that it shared key audit findings with the foundation in September.

Mittal has rejected Magnum’s claims, accusing both Magnum and Unilever of attempting to discredit her and undermine the board’s authority. “Magnum’s midnight purge of independent directors who provide oversight authority and holding hostage charitable funds— all while they continue to conceal the audit report and scope of work — speak for themselves,” Mittal said in a statement on Thursday.

Magnum described the ongoing litigation as “regrettable” and said it remains committed to supporting Ben & Jerry’s operations. “We look forward to the development of a refreshed Board with a majority of Independent Directors, led by an Independent Director,” the company said in a statement.

The company further alleged that the Ben & Jerry’s Foundation had repeatedly issued grants to organisations where trustees — including Mittal — held senior roles and received compensation or other benefits. The foundation, for its part, said it had “become collateral damage” amid the escalating dispute.

Tensions between Ben & Jerry’s and its parent companies first became public in 2021, when the ice cream maker announced it would stop selling products in Israeli-occupied West Bank territories — a move that marked the beginning of a deepening rift over governance and values.

Babcock International Group (LSE:BAB) has reported continued strong financial and operational momentum for the nine months ended 31 December 2025, supported by solid organic revenue growth, improving underlying operating margins and high revenue visibility, with the majority of full-year revenue already secured under contract. The performance underpins management’s confidence in delivering its targeted 8% operating margin in FY26.

Growth was led by robust activity across the Nuclear, Aviation and Marine divisions, including clean energy projects, submarine support work, increased volumes within the LGE and Skynet programmes, and the ramp-up of France’s Mentor 2 aviation contract. These gains more than offset weaker performance in the Land segment, where activity was impacted by lower rail-related volumes.

Operationally, Babcock highlighted a series of strategic contract wins and milestones. These included its selection as prime industrial partner for Indonesia’s £4 billion Maritime Partnership Programme, the signing of a letter of intent for two additional Arrowhead 140 licence agreements, continued progress on the Type 31 frigate build at Rosyth, and an expanded partnership with HII to manufacture assemblies for US Virginia-class submarines under the AUKUS framework. The group is also advancing initiatives to support the Royal Navy’s transition toward autonomous and hybrid naval operations.

Elsewhere, Babcock continues to ramp up delivery under its £1 billion DSG Land contract, has begun supplying Jackal 3 vehicles to the British Army, and remains in discussions regarding a potential extension to its Future Maritime Support Programme. Capital returns remain a priority, with £90 million already returned as part of a £200 million share buyback programme. The company also confirmed a planned leadership transition, with chief executive David Lockwood set to retire by the end of 2026 and Nuclear division head Harry Holt named as his successor, signalling a focus on continuity.

From an outlook perspective, Babcock is supported by strengthening financial performance, solid cash conversion and a confidence-boosting earnings update that reaffirmed margin targets. Technical indicators point to an established upward trend, although overbought conditions suggest elevated near-term risk. Valuation remains the primary constraint, reflecting a higher price-to-earnings ratio and a relatively low dividend yield.

More about Babcock International

Babcock International Group is a UK-based engineering services company operating across the defence, nuclear, aviation and critical infrastructure sectors. The group provides complex asset management, support and training services, with particular strength in naval shipbuilding and support, nuclear submarine maintenance, military vehicle programmes and aviation support for government and commercial clients worldwide.

STV Group plc (LSE:STVG) has indicated that full-year 2025 revenue is expected to land toward the upper end of its £165 million to £180 million guidance range, with adjusted operating profit forecast to meet market expectations at around £11.4 million. This comes despite an estimated 10% decline in total advertising revenue across both the fourth quarter and the full year, reflecting ongoing macroeconomic pressure on advertising spend.

To offset the softer revenue environment, the group is implementing further cost reduction measures. Savings initiatives announced in September are expected to generate £2.5 million of additional cost benefits in 2026, on top of a previously targeted £5 million annual run-rate. STV also expects year-end net debt to sit toward the lower end of its £45 million to £50 million guidance range. Within its studios division, the company closed 2025 with a £33 million order book, despite subdued commissioning activity, while its recently launched STV Radio platform has delivered an encouraging early response as the group adapts its strategy to a more challenging advertising landscape and evaluates longer-term strategic options.

From an outlook perspective, STV’s assessment remains mixed. Financial risk persists due to negative equity and rising debt levels, despite the earnings recovery and positive cash flow achieved in 2024. Valuation remains a notable positive, supported by a low price-to-earnings ratio and a high dividend yield, while technical indicators are broadly neutral, reflecting mixed signals across key moving averages. Recent corporate updates provide some support, though they remain secondary to broader market conditions.

More about STV Group

STV Group plc is a UK-based media company operating across broadcasting, content production and related media services. The group’s activities include its television operations, a growing studios business, and its recent expansion into audio through the launch of STV Radio, positioning STV to serve advertisers and audiences across an evolving media and advertising landscape.

Pets at Home Group Plc (LSE:PETS) has announced that Sarah Pollard will join the group on 23 March 2026 as chief financial officer designate, before formally assuming the role of CFO and executive director on 27 March 2026. She will succeed current CFO Mike Iddon, who will step down from the board on the same date but remain with the business until 10 April 2026 to support a smooth transition.

The phased handover reflects a planned approach to leadership succession within the finance function, aimed at maintaining operational continuity and financial oversight during the changeover period. Management emphasised that the transition has been structured to ensure stability for employees, investors, and other stakeholders.

From a market perspective, Pets at Home continues to benefit from strong underlying financial performance and an attractive valuation profile, supported by a comparatively high dividend yield. Ongoing share buybacks provide an additional positive signal, although recent challenges in the UK retail environment and a prior profit warning remain key risk considerations for the outlook.

More about Pets at Home

Pets at Home Group Plc is the UK’s largest pet care business, providing products, services, and veterinary care through a network of more than 450 pet care centres and a substantial online platform. Many locations incorporate veterinary practices and grooming salons, and the group also operates a nationwide small-animal veterinary business with over 440 general practices, both within its stores and at standalone sites, giving it a well-integrated presence across the UK pet care market.

European equities moved higher on Thursday, recovering ground after U.S. President Donald Trump shelved plans to impose tariffs on eight European countries and ruled out the use of force over Greenland.

NATO Secretary General Mark Rutte said he held a “very productive” discussion with Trump on the sidelines of the World Economic Forum in Davos, focusing on how NATO allies can work together to strengthen security in the Arctic region. The talks covered not only Greenland but also the seven NATO member states with territory in the Arctic.

Markets responded positively, with the UK’s FTSE 100 rising around 0.4%, while France’s CAC 40 and Germany’s DAX were both up about 1.0%.

In corporate news, Associated British Foods (LSE:ABF) advanced after publishing an update on its trading performance over the Christmas period.

Shares in Bayer (TG:BAYN) also moved higher after the German chemicals and pharmaceuticals group said its investigational cell therapy, OpCT-001, had been granted Orphan Drug Designation by the U.S. Food and Drug Administration for the treatment of retinitis pigmentosa.

Europe’s largest carmaker, Volkswagen (TG:VOW3), posted strong gains after reporting robust full-year cash flow.

French transport infrastructure operator Getlink (EU:GET) also traded higher after announcing stable 2025 revenue of just over €1.59 billion.

Telecom stocks were among the top performers, with Orange (EU:ORA) and Bouygues (EU:EN) jumping after confirming that, alongside Iliad’s Free, they are in talks with Altice Group to acquire a significant portion of its French telecommunications operations.

On the downside, Swedish hygiene products group Essity (TG:ESWB) fell sharply after reporting weaker sales volumes in the fourth quarter.

In London, B&M European Value Retail (LSE:BME) shares also declined after the retailer cut its full-year outlook following disappointing Christmas trading.

UK equities moved higher on Thursday, tracking gains across European markets after U.S. President Donald Trump softened his stance on tariffs linked to Greenland. The shift weighed on defence stocks, while carmakers were among the strongest performers.

By 12:27 GMT, the FTSE 100 was up 0.3%. Sterling was little changed, with GBP/USD holding at 1.347. On the continent, Germany’s DAX and France’s CAC 40 were both higher by more than 1%.

UK and Europe market overview

European defence shares slipped after Trump said he would not move ahead with fresh tariffs on European countries, pointing to progress toward “the framework of a future deal” related to Greenland.

Shares in Germany’s Rheinmetall AG (TG:RHM), Italy’s Leonardo SpA (BIT:LDO), France’s Thales (EU:HO) and Sweden’s SAAB AB (BIT:1SAAB) were among the decliners.

Trump said the decision followed talks with NATO secretary-general Mark Rutte, which he described as “very productive.” He added that discussions would continue and could lead to an outcome that, “if consummated,” would be “a great one” for the United States and NATO allies.

In contrast, European auto stocks advanced, with Mercedes-Benz Group AG (TG:MBG), BMW (TG:BMW), Stellantis NV (BIT:STLAM) and Ferrari NV (BIT:RACE) all trading higher.

Stock movers

In the UK, Computacenter PLC (LSE:CCC) shares jumped after the group brought forward its full-year trading update and flagged stronger-than-expected results. The IT services provider said gross invoiced income rose 31% year on year in 2025, or 32% at constant currency, around 14% ahead of market expectations. Adjusted profit before tax is now expected to be no less than £270 million.

Shares in Senior plc (LSE:SNR) surged after the company said full-year 2025 adjusted profit before tax would be “comfortably above previous expectations,” supported by particularly strong performance in its Aerospace division.

By contrast, B&M European Value Retail SA (LSE:BME) fell after reporting weaker third-quarter trading and trimming its full-year profit guidance. UK like-for-like sales declined 0.6% in the third quarter, although trading improved as the period progressed, with December delivering 3% growth.

Harbour Energy PLC (LSE:HBR) shares moved lower after the company guided to reduced output in 2026, despite a strong finish to 2025. Harbour expects production next year of between 435,000 and 455,000 barrels of oil equivalent per day, excluding planned asset disposals and its $3.2 billion acquisition of LLOG.

Meanwhile, AJ Bell PLC (LSE:AJB) reported assets under administration of £109.6 billion at the end of 2025, roughly £2 billion above consensus forecasts. The group added 26,000 new direct-to-consumer customers in the first quarter, more than double the 11,000 expected by analysts.

Finally, Beazley PLC (LSE:BEZ) fell after the insurer unanimously rejected a takeover approach from Zurich Insurance Group AG (BIT:1ZURN). Beazley said the proposal of 1,280 pence per share, valuing the company at about £8.2 billion, materially undervalued the business.

European equities climbed sharply on Thursday after U.S. President Donald Trump said he would not move forward with tariffs on European countries linked to Greenland, adding that a framework agreement had been reached regarding the Danish territory.

By 08:05 GMT, Germany’s DAX was up 1.2%, France’s CAC 40 had gained 1.3%, and the UK’s FTSE 100 was 0.7% higher.

Trump backs away from tariff plans

Speaking on Wednesday at the World Economic Forum in Davos, Trump ruled out the use of military force—after weeks of leaving the option open—and said in a social media post that he would no longer impose tariffs that had been due to take effect on February 1.

The U.S. president said he and NATO Secretary General Mark Rutte had “formed the framework of a future deal with respect to Greenland and, in fact, the entire Arctic Region” following talks at the Swiss resort.

Earlier in the week, European markets had sold off sharply after Trump threatened escalating tariffs on several European countries unless the United States was allowed to purchase Greenland, an autonomous territory of Denmark.

Despite the market relief, uncertainty remains around the future strength of the traditional alliance between the European Union and the U.S. That tension was underlined on Wednesday when European Central Bank President Christine Lagarde walked out of a dinner during a speech by U.S. Commerce Secretary Howard Lutnick.

Lagarde said earlier in the day that the European economy needs a “deep review” to confront “the dawn of a new international order.”

U.S. inflation data in focus

There is little in the way of major European economic data scheduled for Thursday, but investors are closely watching a series of key U.S. releases.

Weekly initial jobless claims will offer insight into labour market conditions, while the latest reading of third-quarter gross domestic product is expected to confirm underlying economic resilience. However, the most closely followed figure may be November core PCE inflation—the Federal Reserve’s preferred measure of price pressures—as markets look for clues on the likely trajectory of U.S. interest rates this year.

Corporate updates across Europe

In company news, Associated British Foods (LSE:ABF) said underlying sales at its Primark clothing chain declined over the Christmas trading period, in line with estimates released alongside its profit warning earlier this month.

Spain’s Bankinter (BIT:1BKT) reported a 14.4% increase in net profit to a record €1.09 billion in 2025, supported by strong growth in off-balance-sheet funds and fee income, which offset weaker net interest income as rates fell.

Swiss healthcare group Galenica (BIT:1GALE) said 2025 sales rose 5.5% to an all-time high, with all divisions contributing, and reaffirmed EBIT growth guidance of 10–12% for the year.

Meanwhile, Huber + Suhner (LSE:0QNH) said full-year order intake increased nearly 14% year on year, although net sales declined 3.3% as the Swiss franc strengthened.

Oil prices steady as inventory build weighs

Oil prices were little changed on Thursday as easing tariff concerns around Greenland were offset by rising U.S. crude inventories.

Brent crude slipped 0.3% to $65.02 a barrel, while U.S. West Texas Intermediate fell 0.2% to $60.49.

The American Petroleum Institute reported that U.S. crude inventories rose by just over 3 million barrels in the week ended January 16, following a jump of more than 5 million barrels the previous week. Gasoline inventories increased by 6.21 million barrels, signalling softer demand, while distillate stocks—which include diesel and heating oil—fell by 33,000 barrels.

Official U.S. inventory data from the Energy Information Administration are due later in the session, released a day later than usual because of a U.S. federal holiday on Monday.