Major European stock markets struggled for direction on Friday, with both the STOXX 50 and STOXX 600 hovering near the flatline after reaching fresh 25-year and record highs, respectively, in the previous session.
European shares waver on Friday
Investors continued to digest a mixed batch of corporate earnings while awaiting the highly anticipated US jobs report for further clues on the Federal Reserve's next policy moves. The report could provide insights into the strength of the labor market and influence future interest rate decisions, adding an element of uncertainty to market sentiment.
Meanwhile, weaker-than-expected quarterly results from Amazon dampened investor optimism and contributed to broader market concerns. Amazon's underperformance sparked concerns about slowing consumer demand and rising costs, which, in turn, affected investor sentiment across sectors. Among the worst-performing sectors were healthcare, household goods, autos, and oil and gas, which faced pressure from various factors including disappointing earnings and rising costs of raw materials.
On the other hand, construction materials, retail, real estate, and banks recorded the biggest gains, benefiting from more favorable earnings reports and investor optimism surrounding their future prospects. In the corporate space, L'Oreal experienced a significant drop of nearly 4% after posting its slowest quarterly sales growth since the pandemic, signaling potential challenges in the beauty and cosmetics market. Porsche was also down more than 6% following the announcement of impairments and lower-than-expected sales guidance for 2025, raising concerns about the automotive sector's performance in the near term.
Banco Sabadell sees a positive reaction
In contrast, Banco Sabadell saw a positive reaction, gaining about 1% after reporting a strong 75% rise in Q4 net profit, signaling healthy financial performance and resilience in the banking sector. Looking at the full week, the STOXX 50 posted a solid gain of 1.3%, while the STOXX 600 rose by 0.9%, driven by a mix of strong sector performances and investor optimism in certain areas despite the overall volatility.
