European stocks on track to log fifth straight week of gains

The STOXX 50 edged up 0.2% and the broader STOXX 600 gained 0.6% on Friday, with both benchmarks poised to end the week approximately 1.8% higher, potentially marking their fifth consecutive weekly advance and the longest winning streak since early 2023.

European stocks on track to log fifth straight week of gains

Markets remained cautiously optimistic as investors weighed signs of a tentative de-escalation in the prolonged US-China trade war, spurred by the recently announced 90-day reduction in tariffs, while keeping a close watch on the Russia-Ukraine ceasefire negotiations, which have shown modest but fragile progress. Sector-wise, defensive areas such as healthcare, telecommunications, and oil & gas led the gains, reflecting a still-cautious undertone in risk appetite as concerns lingered over the broader global economic outlook. Healthcare shares extended their rally as investors favored companies with stable earnings and pricing power amid an environment of moderating inflation but still-subdued growth. Oil & gas stocks were supported by firmer crude prices, underpinned by renewed geopolitical tensions in the Middle East and a softer US dollar. On the flip side, technology stocks underperformed for the second day, amid profit-taking following the sector's recent outperformance and as investors rotated into more value-oriented sectors. Semiconductor shares, in particular, came under some pressure following cautious guidance from US peers, which sparked concerns about softening demand for chips in the second half of the year.

Richemont among best performers

In corporate news, Richemont shares surged around 4% after the Swiss luxury goods giant reported a stronger-than-expected 7% increase in first-quarter revenues, driven by robust demand in Asia and resilient performance in Europe, signaling that wealthy consumers remain relatively insulated from broader economic uncertainties. Swiss Re also posted solid results, with a 16% rise in quarterly profit, underpinned by lower catastrophe claims and strong investment income. However, the reinsurer’s shares fell by around 1%, as investors focused on cautious forward guidance amid ongoing concerns about pricing pressures and claims inflation. Elsewhere, investors digested a raft of other earnings reports, including from major European industrials and banks, while closely following economic data releases across the eurozone, where revised figures showed Q1 GDP growth was slightly weaker than initially estimated, at 0.3%. The data reinforced expectations that the European Central Bank will likely continue its cautious easing cycle, even as some policymakers flagged that rate cuts beyond June would depend heavily on incoming inflation and wage data.