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Business Times
16 hours ago
- Automotive
- Business Times
Europe: Stocks end at over one-week low; beverage makers hurt by US tariffs
EUROPEAN shares closed at a more than one-week low on Thursday, as investors were disappointed by a series of corporate reports from the likes of Sanofi and Ferrari, while beverage makers slid as they were faced with a 15 per cent US tariff. Earnings were in full swing in Europe this week as traders gauged the impact US tariffs were likely to have on corporate performance for the rest of the year. The pan-European Stoxx 600 index finished 0.75 per cent lower at 546.11, with Italian stocks underperforming the most in major markets with a 1.5 per cent decline. Italian luxury carmaker Ferrari slid 11.7 per cent - marking its biggest one-day drop since its listing nine years ago. The stock also weighed on the broader Stoxx automobile sector which was down nearly 4 per cent. The sports-car maker maintained its annual forecasts and said that it will reduce the price compensation it introduced earlier on some cars sold in the US, once the US-EU trade deal was effective. However, analysts mulled if the company can sustain its high profitability. Drugmaker Sanofi also dropped 7.8 per cent after reporting lower-than-expected earnings, but said that the impact from US tariffs could be manageable. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'When we think about sectors like automotives, pharma and consumer discretionary names - the risk is these sectors are particularly vulnerable to US tariffs,' said Craig Cameron, portfolio manager and research analyst at Templeton Global Investments. 'So we're consciously deciding to lean away from them and focus more on utilities, industrials, and financials that are largely domestically driven and insulated from tariffs.' Euro zone banks continued their upward momentum, adding 0.7 per cent on Thursday and have significantly outperformed the broader market in July. The sector logged monthly gains of 49 per cent, compared with the Stoxx's 7.6 per cent rise. The sector also got a boost on the day after Societe Generale raised its annual profit target sending its shares up 6.9 per cent, while BBVA added 7.9 per cent after second-quarter net profit beat expectations. Dashing hopes for beverage makers, European diplomats said that wine and spirits exports from the bloc will now face US tariffs until a different deal is agreed in talks expected to continue in the autumn. The broader Stoxx food and beverage sector closed 2.6 per cent lower and was further weighed by a 11.6 per cent slump in Anheuser-Busch InBev after the beer giant reported a fall in volumes. Also pressuring equities, the yield on the short-term 2-year German bond rose to touch its highest since April as money markets pared back their bets on upcoming European Central Bank interest rate cuts. They now reflected a 50 per cent chance of an additional 25-basis-point easing move by the end of the year. In the UK, energy giant Shell gained 1.1 per cent after beating profit expectations for the quarter. REUTERS
Business Times
4 days ago
- Automotive
- Business Times
Europe: Shares close lower as US-EU trade deal draws mixed response
EUROPEAN shares pulled back from a four-month high and settled Monday's choppy session marginally lower as investors weighed the implications of a framework trade agreement between the United States and the European Union. The pan-European Stoxx 600 index rose as much as 1 per cent to touch a four-month high on initial relief that prolonged negotiations yielded a deal that said a 15 per cent US tariff will be slapped on most EU goods - a significant reduction from the previously threatened 30 per cent rate. However, the index closed 0.22 per cent lower at 548.76 as the deal quashed hopes for a zero-for-zero agreement and an average rate last year of around 2.5 per cent. 'While the 15 per cent tariff on most EU exports is lower than the threatened 30 per cent, it's still a sharp jump from pre-2025 levels when many goods faced tariffs under 3 per cent, and is likely to add to inflationary pressures in the months ahead,' Lale Akoner, global market analyst at eToro, said. Auto-related stocks were among top sectoral underperformers with a 1.7 per cent decline. The baseline tariff brings levies for the auto industry down from the 27.5 per cent faced before. Spirits stocks Pernod Ricard and Anheuser-Busch inBev slipped 3.5 per cent and 3.6 per cent, respectively, as the trade deal did not contain any decision regarding the spirits sector. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Heineken dropped the most on the benchmark index, down 8.5 per cent, after the Dutch brewer said it was weighing all options to deal with growing tariff challenges long-term, including shifting manufacturing. The deal also said EU member states will purchase US military equipment, without specifying an amount. The Stoxx defence sector ended 1.3 per cent lower. The benchmark Stoxx index has gained about 19 per cent since the initial shock after Trump initially threatened tariffs in early April. It is now within 2.5 per cent of its March all-time high. 'We're actually neutral on both US and European stocks, but on the short term if we have to think till the year end, we're more positive actually on US versus European stocks,' said Anthi Tsouvali, multi-asset strategist at UBS Wealth. On the flip side, energy sector stocks rose 1.1 per cent, as oil prices were boosted after the trade deal. Technology shares advanced 0.6 per cent as ASML, the world's biggest supplier of computer chip-making equipment, gained 4.9 per cent on expectations that the sector might be exempted from tariffs. The healthcare sector was also marginally higher. Investors face a week with several market-moving events including policy decisions from the Federal Reserve and Bank of Japan, earnings from 'Magnificent Seven' tech companies like Apple and Microsoft, and the Aug 1 tariff implementation deadline. REUTERS
Business Times
7 days ago
- Business
- Business Times
Europe: Shares settle lower as investors gauge mixed earnings, EU-US trade progress
[BENGALURU] European shares closed lower on Friday (Jul 25), as investors assessed mixed corporate earnings while awaiting updates on a framework of an EU-US trade deal that officials said could be reached as early as this weekend. Investors navigated the peaks and troughs around a potential agreement between the two large economies after a busy week of trade discussions with the US culminated in deals with Japan, Indonesia, and the Philippines. The pan-European Stoxx 600 index dropped 0.3 per cent to session lows after US President Donald Trump said there was less chance of an agreement with the EU, but pared losses after EU diplomats reiterated that a deal of 15 per cent duties on European goods was still in the works. The index last closed 0.2 per cent lower with most regional bourses in red, but on a weekly basis, the Stoxx index was on track for modest gains. 'It's hard to spin it as a good deal, but it would at least avoid much higher US tariffs and retaliation from the EU,' said Jack Allen-Reynolds, deputy chief euro zone economist at Capital Economics. 'The reported deal with the US would take a major downside risk off the table for now, weakening the case for further interest rate cuts.' Also weighing on stocks were elevated bond yields that got a lift after the European Central Bank's comments on Thursday tempered expectations of imminent interest rate cuts. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Meanwhile, corporate earnings were in full swing. Puma was the biggest percentage loser on the benchmark index, falling 16 per cent, its largest daily drop in more than four months. The sportswear brand cut its full-year outlook and reported weaker-than-expected quarterly results. London-listed sports retailer JD Sports slipped 0.7 per cent after Puma's results. On the flip side, LVMH gained 3.9 per cent after the French luxury group reported quarterly results, with analysts pointing to hopes on the horizon as the group said it saw signs of recovery in the Chinese market. The broader luxury index rose 1.8 per cent and was the top sectoral performer. Automobile stocks gained 1.4 per cent, boosted by Volkswagen's 4.6 per cent rise after the CEO of Europe's biggest carmaker said cost cuts must be accelerated in response to tariffs. Earlier in the session, shares took a hit on the company's slashed full-year sales and profit margin forecasts. Still, Traton, a truck unit of German automaker Volkswagen, fell 4.1 per cent. Carrefour gained 5.5 per cent after Europe's biggest food retailer reported its half-year results. Attention next week will turn to key events, including policy decisions from the Federal Reserve, earnings from several 'Magnificent Seven' companies, and Trump's Aug 1 tariff deadline. REUTERS
Bloomberg
7 days ago
- Automotive
- Bloomberg
European Stocks Decline While Tariff-Exposed Stocks Play Catch Up
European stocks trimmed declines into the close of trading Friday as the prospect of a tariff deal boosted automakers and luxury-goods makers. The Stoxx Europe 600 Index ended 0.3% lower after earlier slipping as much as 0.6%. Trade-exposed automakers and consumer products outperformed, reversing declines that were fueled by underwhelming earnings.
Business Times
23-07-2025
- Automotive
- Business Times
Europe: Automakers propel shares to two-week highs on US-EU trade deal optimism
EUROPEAN shares closed near two-week highs on Wednesday, led by automakers, as investors anticipated a possible agreement between the United States and European Union to soften the blow of growth-denting tariffs. Futures tracking the pan-European Stoxx 600 index got a further boost and were last up 2.1 per cent as EU diplomats said the bloc and Washington were headed for a potential trade deal including a 15 per cent US baseline tariff on European imports - half the level US President Donald Trump had threatened. Negotiations between the two economies have lagged in recent weeks, and investors are keen for an agreement before the Aug 1 deadline. The European Commission is planning to unveil counter-tariffs if the talks fail. The benchmark Stoxx index closed 1.08 per cent higher at 550.22 and logged its biggest one-day gain in nearly a month, after Japan struck a trade deal with the US, sparking a rally in automobile stocks earlier in the day. 'One of the premises underlying global markets is that once tariffs are implemented, they will not be as negative as feared,' said Steve Sosnick, chief market analyst at Interactive Brokers. 'From the European point of view, it's understandable why that would be perceived as good news, because it's reasonable to think that there will be some sort of negotiation between the US and the EU to arrive at a deal'. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Most of the major bourses in the region, including Germany's DAX, France's CAC 40 along with main stock indexes in Italy, rallied more than 1.3 per cent. European automobile stocks surged 3.7 per cent and logged its biggest daily rise in close to a month, tracking a steep rally by some Asian rivals. European carmakers such as Stellantis, Mercedes-Benz, Volkswagen and Porsche gained between 6.1 per cent and 7.3 per cent. Earnings were also on the radar, with technology stocks bogged down by a 4.1 per cent slide in SAP as investors were disappointed the software company held off on increasing full-year targets after reporting higher quarterly sales and earnings. ASM International dropped the most on the benchmark index, down 10.4 per cent, after the computer chip equipment maker reported second-quarter bookings below market expectations. UniCredit rose 3.6 per cent after the Italian lender posted higher-than-expected quarterly profit and raised its fiscal-year outlook, a day after a clash with the government prompted Italy's second biggest bank to ditch its takeover bid for rival Banco BPM. Nokia, meanwhile, slumped 7.6 per cent after the Finnish group lowered its guidance for 2025 comparable operating profit, while SSAB's slid 9 per cent after earnings fell more than expected in the second quarter. Spanish stocks were limited by a 4.7 per cent drop in Iberdrola after the utilities company raised 5 billion euros (S$7.5 billion) to help pay for a big rise in investments in power grids in Britain and the United States. REUTERS
