Markets rise on record earnings and U.S. inflation expectations

European stock markets advance during one of the busiest weeks of the earnings season, while U.S. futures point to a positive opening on Wall Street. The Stoxx 600 gains 0.4%, supported mainly by industrial and luxury stocks, and contracts on the S&P 500, Nasdaq and Dow Jones move higher by around 0.2–0.3%.

Leading gains across the Old Continent is Siemens, which jumps more than 6% after raising its outlook thanks to strong demand in industrial automation and electrification, offsetting the negative impact of currency effects. EssilorLuxottica also rallies, up 10% following an 18% increase in quarterly sales, driven by the boom in artificial intelligence-based eyewear. Schroders also shines, gaining 30% after announcing its acquisition by Nuveen in a £9.9 billion deal set to create one of the world’s largest active asset managers.

However, there are some shadows: Magnum Ice Cream falls by as much as 16% in Amsterdam after a decline in operating profit, while Mercedes-Benz warns that margins will remain under pressure due to tariffs and competition in China. Signs of resilience come from Hermès, which confirms the strength of the luxury sector with sales rising across all geographic regions.

On the macro front, markets remain focused on the United States. Stronger-than-expected labor data initially reinforced expectations of a cautious Fed regarding interest rate cuts. Attention now turns to Friday’s inflation data, which could reopen the debate on possible reductions in borrowing costs over the course of the year.

Meanwhile, the 10-year Treasury yield remains stable at 4.17%, the dollar edges lower, and the euro holds around 1.18. In Asia, markets extend their rally for a fifth consecutive day: the MSCI Asia Pacific index is up about 13% year-to-date, significantly outperforming the S&P 500 thanks to more attractive valuations and growth prospects supported by investments in artificial intelligence. Among other asset classes, Brent crude slips below $70 per barrel, gold retreats, and Bitcoin fluctuates just above the $67,000 mark.

Andrea Pelucchi