European Stocks Inch Higher as Traders Weigh Business Activity and Trade Tensions

European markets edged up on Friday, as investors assessed fresh business activity data and ongoing geopolitical risks, including trade tensions and defense spending concerns.

As of 04:21 ET (09:21 GMT):

• STOXX 600 rose 0.3% to 552.56, though it was set for a weekly loss, snapping an eight-week winning streak—the longest since March 2024.
• France’s CAC 40 gained 0.4%, while Germany’s DAX and the UK’s FTSE 100 remained broadly unchanged.

Geopolitical and Trade Uncertainty Drive Market Sentiment

• U.S.-Russia talks on Ukraine helped push European shares to record highs earlier in the week.
• Defense stocks gained as statements from Trump’s administration raised speculation that Europe may have to boost military spending, given potential shifts in U.S. security commitments.
• Increased defense spending expectations contributed to higher European bond yields, as governments may issue more debt to fund military budgets.
• Concerns over Trump’s proposed tariffs on European imports also weighed on investor sentiment.

Mixed Business Activity Data Across Europe

• Germany, Europe’s largest economy, saw a pick-up in business activity in February.
• France, however, reported contraction, dampening the broader Eurozone business growth, which expanded but at a slower-than-expected pace.

Key Corporate Earnings

Standard Chartered Posts Strong 2024 Results

• Underlying profit before tax reached $6.8 billion, fueled by wealth management and corporate banking growth.
• Announced a $1.5 billion share buyback and a final dividend of 28 cents per share, bringing total shareholder payouts to $4.9 billion.
• Shares jumped over 4% in London trading.

Sika Reports Solid Growth Despite Industrial Weakness

• Net sales rose 4.7% to CHF 11.76 billion.
• Construction sector sales climbed 6.4%, offsetting a 4.6% decline in industrial manufacturing.
• Core income increased by 11% to CHF 2.27 billion.

Air Liquide Upgrades Mid-Term Outlook

• French multinational raised its mid-term margin target and extended its financial projections to 2026, forecasting a 4.6 percentage point improvement over five years.

Oil Prices Hold Steady, Set for Weekly Gain

• Crude hovered slightly below the flatline but was on track for a weekly increase.
• Investors monitored supply chain disruptions in Russia and a decline in U.S. gasoline and distillate stockpiles.

As geopolitical risks persist and business activity data remains uneven, markets continue to navigate a complex mix of economic signals and trade policy concerns.