European markets look to rebound after sharp sell-off
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European futures inch higher after steep losses
European equity futures are slightly higher on thursday, attempting to recover from wednesday’s 0.9% drop in the stoxx 600 (sxxp), the biggest one-day decline this year. Futures on the Euro stoxx 50 (fesx1!) are up 0.25%, reflecting cautious sentiment as traders navigate geopolitical risks, tariffs, and earnings reports.
Tariffs and Ukraine in focus
Markets remain on edge following Donald Trump’s announcement of new import tariffs, adding lumber and forest products to previously planned levies on autos, semiconductors, and pharmaceuticals on the Ukraine front, Jefferies' economist Mohit Kumar emphasized that regardless of how peace talks unfold, european defense spending is set to rise, which should support sectors like defense, machinery, and financials.
Earnings spotlight
The automotive sector is in focus after mixed earnings reports from Renault (rno) and Mercedes-Benz (mbg) Airbus (air) delivered in-line earnings but flagged short-term production challenges, while Lloyds Bank (lloy) reported a 20% drop in annual profit, missing estimates as interest rate cuts weighed on lending margins.
Trading Outlook
European markets remain volatile as geopolitical risks and tariff uncertainty weigh on sentiment stoxx 600 key support is at 480-485, while resistance sits at 500 with defense stocks poised to benefit from increased military budgets, sectors like industrial machinery and aerospace could see renewed interest in the coming weeks.
European equity futures are slightly higher on thursday, attempting to recover from wednesday’s 0.9% drop in the stoxx 600 (sxxp), the biggest one-day decline this year. Futures on the Euro stoxx 50 (fesx1!) are up 0.25%, reflecting cautious sentiment as traders navigate geopolitical risks, tariffs, and earnings reports.
Tariffs and Ukraine in focus
Markets remain on edge following Donald Trump’s announcement of new import tariffs, adding lumber and forest products to previously planned levies on autos, semiconductors, and pharmaceuticals on the Ukraine front, Jefferies' economist Mohit Kumar emphasized that regardless of how peace talks unfold, european defense spending is set to rise, which should support sectors like defense, machinery, and financials.
Earnings spotlight
The automotive sector is in focus after mixed earnings reports from Renault (rno) and Mercedes-Benz (mbg) Airbus (air) delivered in-line earnings but flagged short-term production challenges, while Lloyds Bank (lloy) reported a 20% drop in annual profit, missing estimates as interest rate cuts weighed on lending margins.
Trading Outlook
European markets remain volatile as geopolitical risks and tariff uncertainty weigh on sentiment stoxx 600 key support is at 480-485, while resistance sits at 500 with defense stocks poised to benefit from increased military budgets, sectors like industrial machinery and aerospace could see renewed interest in the coming weeks.