European stock markets closed the first session of the week in positive territory. The FTSE MIB posted the strongest performance, ending up 1.01%

Indices

Major European indices are maintaining elevated levels, with several benchmarks trading near or just below record highs, signaling resilience and sustained institutional inflows. The FTSE MIB Index 42916.6 is exhibiting notable strength, up 1.01192 for the session, underpinned by a strong long-term bullish trend signal. The DAX Performance Index 24303.18 is up modestly 0.2611, though with a flat micro-trend, indicating consolidation near its year high. France’s CAC 40 8242.62 is hovering close to its annual peak with a flat trend, suggesting market indecision amid ongoing political developments.

The FTSE 100 9650.04 is trading nearly unchanged, up slightly 0.04582391, reflecting cautious investor sentiment and a flat trend. Spain’s IBEX 35 15990.2 is holding just below its year high, gaining 0.8114, and also exhibiting a flat short-term trend. The Euro STOXX 50 5709.34 continues to stand out, rising 0.61397, and maintaining a strong long-term bullish trend, which indicates persistent institutional inflows and broad-based confidence.

Short-term momentum is particularly strong for the FTSE MIB and Euro STOXX 50, both showing clear buy signals. The remaining indices display flat to cautiously positive short-term momentum, supporting a selective and rotational approach to index-level positioning.

Stocks

Today’s equity landscape is defined by pronounced sector rotation. Basic resources and banking stocks are leading the rally, with steelmakers such as ArcelorMittal (MT:MT), Aperam (APAM.AS), Thyssenkrupp (TKAG.DE), and SSAB (SSABa.ST) each advancing over 3 following changes to European steel import quotas. Spanish banks Sabadell (SABE.MC) and Caixabank (CABK.MC) continue to post impressive year-to-date returns of 67 and 47, further supporting the IBEX 35’s strength. In contrast, automotive stocks such as BMW (BMW:GR) have declined 8.9 after negative earnings outlooks, while technology leaders ASML (ASML.AS) and ASMI (ASMI.AS) are under pressure due to renewed chip export restrictions.

French banks, including Société Générale (GLE), Crédit Agricole (ACA), and BNP Paribas (BNP), have experienced declines, weighing on the CAC 40 and reflecting sector-specific regulatory and political risks. The prevailing trading strategy in this environment emphasizes momentum in basic resources and banking stocks, while advocating defensive positioning in autos and technology.

Economic News

Recent economic data have underpinned optimism in European equities. In Spain, Industrial Production Year-over-Year for August registered at 3.4, surpassing the previous 2.7, supporting IBEX 35 momentum. However, the Spanish trade balance for August deteriorated to -6 from -4.01, a deterioration of -49.626, injecting some caution into sentiment.

Eurozone consumer confidence improved in October, rising by 0.7 to -14.2, defying consensus estimates and suggesting a firmer outlook for consumer-driven sectors. Recent EU and U.S. sanctions on Russia have triggered a 2.5 rally in energy stocks, as oil market uncertainty increases.

Economic Events

This week features several pivotal macroeconomic releases with the potential to drive volatility. Key events include the release of Eurozone Industrial Production and GDP data, Germany’s ZEW Economic Sentiment Index, and France’s Consumer Price Index, all closely watched for their implications on growth and inflation trajectories. In Spain, the Consumer Confidence figure for September is estimated at 85, up from the previous 82.9, suggesting incremental improvement in sentiment. Central bank meeting minutes from both the Federal Reserve and European Central Bank are highly anticipated and could influence expectations for future interest rate moves and impact rate-sensitive sectors.

Market Sentiment

Sentiment across European equities remains cautiously optimistic. Sustained inflows into blue-chip indices—particularly the Euro STOXX 50 and FTSE MIB—are driven by expectations of stable credit conditions and supportive central bank policies. Outperformance in basic resources and banking is balancing out persistent weakness in auto and technology sectors, reflecting a tactical, sector-rotational approach among investors. Despite ongoing geopolitical and regulatory risks, the technical and macroeconomic backdrop continues to favor further upside in core European indices, with near-term caution warranted ahead of key economic releases and policy events.

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