The Eurozone closed in negative territory, with the IBEX and the FTSE 100 the only indexes ending in positive territory

Indices

Major European indices are trading near or just below their record highs, reflecting ongoing institutional inflows and sector-driven momentum. The FTSE MIB Index (FTSEMIB.MI) is quoted at 42212.26, registering a daily decline of -436.02 or -1.02236, but maintains a strong long-term bullish trend. The DAX Performance Index (^GDAXI) trades at 24147.32, down -182.71 or -0.75096, yet remains resilient near all-time highs. France’s CAC 40 (^FCHI) stands at 8206.87, up marginally by 0.8 or 0.00974888, reflecting cautious optimism.

The FTSE 100 (^FTSE) is trading at 9526.17, with a substantial daily gain of 99.18 or 1.05209, supported by energy and financial stocks. The IBEX 35 (^IBEX) posts 15780.3, up 13.2 or 0.08371863, sustaining its bullish undertone just off its annual peak. The Euro STOXX 50 (^STOXX50E) is at 5641.29, with a daily decrease of -45.54 or -0.8008, but retains a strong long-term bullish signal.

Short-term trend signals indicate “strong long” momentum for the FTSE MIB and Euro STOXX 50, while other indices display a flat or neutral bias. This trend suggests institutional appetite for blue-chip and resource-heavy benchmarks, favoring trend-following strategies in these indices.

Stocks

Sector rotation remains the key theme, with basic resources and banking stocks leading the rally. Steelmakers such as ArcelorMittal (MT:MT), Aperam (APAM.AS), Thyssenkrupp (TKAG.DE), and SSAB (SSABa.ST) have each advanced over 3 following changes to European steel import quotas, which has propelled the sector. Spanish banks Sabadell (SABE.MC) and Caixabank (CABK.MC) have delivered impressive year-to-date gains of 67 and 47, underpinning IBEX 35’s outperformance.

Conversely, automotive stocks such as BMW (BMW:GR) have declined 8.9 after negative earnings revisions. Technology leaders ASML (ASML.AS) and ASMI (ASMI.AS) are under pressure from renewed U.S. chip export restrictions. French banks, including Société Générale (GLE), Crédit Agricole (ACA), and BNP Paribas (BNP), have also experienced declines, weighing on the CAC 40.

Trading strategies should emphasize momentum in resources and banking, while remaining defensive in autos and technology sectors due to persistent headwinds.

Economic News

Recent economic data have lent support to European equities. Spain’s Industrial Production YoY for August registered at 3.4, surpassing the previous 2.7, indicating robust industrial growth and supporting the IBEX 35. Euronext’s record fixed-income trading revenues in Q1 2025 demonstrate strong market participation and heightened volatility.

Policy changes, notably the European Commission’s adjustment to steel import quotas, have provided a boost to the resource sector. Meanwhile, political developments in France—such as the suspension of pension reforms—have temporarily relieved pressure on French equities, although regulatory uncertainty persists for French banks.

Economic Events

Key macroeconomic releases this week include Eurozone Industrial Production and GDP data, Germany’s ZEW Economic Sentiment Index, and France’s CPI. Central bank meeting minutes from both the Federal Reserve and the European Central Bank are highly anticipated and could significantly influence interest rate expectations and the trajectory of rate-sensitive sectors. Spanish government bond auctions are also scheduled, with recent results indicating easing funding costs and contributing to positive sentiment in sovereign debt markets.

Market Sentiment

Market sentiment across European equities is cautiously optimistic. Sustained inflows into blue-chip indices—particularly the Euro STOXX 50—are driven by expectations of improving credit conditions and continued central bank support. Outperformance in basic resources and banking is being tempered by persistent weakness in automotive and technology names, reflecting a tactical, sector-rotational approach among institutional investors. Despite ongoing political and regulatory uncertainties, the technical backdrop remains constructive, supporting further gains in core European indices.

Please note that the analysis is for informational purposes only and does not constitute financial advice. Users should conduct their own research.