European stock markets opened higher Thursday as investors assess a host of key earnings and economic data, and await the European Central Bank’s latest monetary policy decision.
The pan-European Stoxx 600 index ticked 0.4% higher as sentiment continues to recover following the global technology sell-off on Monday.
The ECB is expected to kick off its first meeting of 2025 with a 25-basis-point interest rate cut Thursday. The move would bring its key overnight deposit facility rate to 2.75%, marking its fifth cut since the bank began easing monetary policy last June.
Market watchers expect further easing this year despite euro zone inflation ticking upwards over the past few months; activity in the single currency area’s manufacturing and services sectors remains broadly subdued and consumer confidence is below its long-term average, European Commission data shows.
Against this backdrop, investors will be closely watching the latest growth data from France, Germany and the euro zone on Thursday, as well as euro zone unemployment, economic sentiment and consumer confidence figures.
German lender Deutsche Bank kicked off a flurry of earnings, reporting a sharper-than-expected fall in fourth-quarter profit, driving its shares down more than 5% in early deals. Oil giant Shell meanwhile saw shares gain 0.55% after posting a significant drop in annual profit following a year of lower crude prices. The company announced a 4% increase in dividend per share and launched another share buyback program of $3.5 billion.
Swedish fashion giant H&M recorded a slightly estimate beat on operating profit, but its sales missed forecasts for the final three months of the year. Shares opened 5% lower before paring losses slightly.
Nokia, ABB, Roche, BT Group, Sage Group, Wizz Air, Electrolux, BBVA, Caixabank, Nordea and Sanofi also report Thursday.
Overnight in the Asia-Pacific region, Australian and Japanese stocks extended gains from the previous session. Taiwan, South Korea, Hong Kong and China markets are closed for Lunar New Year holidays.
Meanwhile, U.S. stock futures rose Wednesday night as Wall Street digested recent quarterly results from several megacap tech companies, and the Federal Reserve’s decision to hold steady on rates.
Europe stocks open higher
European stock markets opened broadly higher Thursday despite big-name earnings disappointing, with the Stoxx 600 index up 0.4% at 8:26 a.m. in London.
Industrials and energy led sector gains, up 0.73% and 0.36%, respectively.
Germany’s DAX and France’s CAC 40 were both around 0.3% higher, while the U.K.’s FTSE 100 rose 0.12%.
Stoxx 600 index.
— Jenni Reid
France’s economy shrank in the fourth quarter
People walking in the streets of Montmartre, Paris, France, on April 23, 2024.
Nurphoto | Nurphoto | Getty Images
France’s economy shrank slightly in the fourth quarter, flash data showed Thursday, highlighting the urgent need for warring French lawmakers to overcome their differences and agree on a 2025 budget.
The economy recorded a 0.1% contraction in the fourth quarter on the previous three months, the country’s statistics agency INSEE revealed Thursday, down from growth of 0.4% in the third quarter of 2024. Economists polled by Reuters had expected growth to be flat.
France’s beleaguered economy was given a boost by the Olympic Games in Paris last summer, but political upheaval has ensued since then, leaving fiscal challenges — namely, France’s big budget deficit and growing debt pile — unresolved.
Read more on the story here: France’s shrinking economy betrays urgent need to overcome budget wrangles
— Holly Ellyatt
Deutsche Bank posts steeper-than-expected Q4 profit fall
Germany’s largest lender Deutsche Bank on Thursday reported weaker-than-expected profit that fell sharply in the last three months of 2024, as legal provisions weighed on the bottom line.
Net profit attributable to shareholders hit 106 million euros ($110.4 million) in the fourth quarter, compared with the 282.39 million euros forecast in a LSEG poll of analysts. The result marked a significant fall from the 1.461 billion euros achieved in the third quarter.
Revenue reached 7.224 million euros in the fourth quarter, versus a LSEG analyst poll of 7.125 billion euros — but was eroded by litigation costs over the period to the tune of 594 million euros.
— Ruxandra Iordache
European markets: Here are the opening calls
European markets are expected to open higher Thursday with investors keeping a close eye on the latest monetary policy decision from the European Central Bank.
The U.K.’s FTSE 100 index is expected to open 2 points lower at 8,555, Germany’s DAX up 24 points at 21,649, France’s CAC up 25 points at 7,892 and Italy’s FTSE MIB up 72 points at 36,627, according to data from IG.
Close market attention will also be on the latest growth data from France, Germany and the euro zone on Thursday, as well euro zone unemployment, economic sentiment and consumer confidence figures.
Earnings come from Nokia, ABB, Roche, Deutsche Bank, H&M, Shell, BT Group, Sage Group, Wizz Air, Electrolux, BBVA, Caixabank, Nordea and Sanofi.
— Holly Ellyatt
