European markets mostly in positive territory, with the exception of Paris and Milan: Piazza Affari down 1.04% following dividend payouts

Indices

Major European indices are trading near multi-year or all-time highs, displaying a combination of consolidation and resilience. The FTSE MIB Index (FTSEMIB.MI) is currently at 42216.77, with a daily decline of -1.04286, following a recent rally to record highs. Despite the minor pullback, the micro-trend remains STRONG_LONG, which signals sustained bullish momentum in Italian equities.

The DAX Performance Index (^GDAXI) is trading at 23177.54, up by 0.371, reflecting underlying stability in German blue chips. The CAC 40 (^FCHI) stands at 7960.25, down slightly by -0.28061, pointing to consolidation after strong gains. The FTSE 100 (^FTSE) is at 9555.09, up 0.16122, signaling ongoing resilience above key averages. Spain’s IBEX 35 (^IBEX) is performing robustly, printing 15929.6 and rising 0.6807, supported by financials.

The Euro STOXX 50 (^STOXX50E) is at 5511.19, almost unchanged at -0.07071507, but maintains a STRONG_LONG, reflecting ongoing institutional confidence in Eurozone blue chips. These performances suggest that European equities are currently in a tactical pause, with potential for renewed upside if macroeconomic and political risks remain contained.

Stocks

Sector rotation is a defining theme in European equities at present. Large-cap stocks such as LVMH (MC.PA), SAP (SAP.DE), and HSBC Holdings (HSBA.L) are among the most actively traded, indicating heightened investor interest in luxury and financial services. The banking sector is particularly strong, with Spanish banks Sabadell (SABE.MC) and Caixabank (CABK.MC) posting impressive year-to-date returns, supporting IBEX 35’s resilience. In the industrials and chemicals space, BASF SE (ETR:BAS) has achieved a notable gain, trading at 43.58 with a daily move of 4.01, while Siemens AG (ETR:SIE) and Deutsche Bank AG (ETR:DBK) are also advancing.

Conversely, autos and technology stocks are experiencing pressure. BMW (BMW:GR) has dropped sharply on a weak earnings outlook, and semiconductor names such as ASML (ASML.AS) and ASM International (ASMI.AS) are facing renewed chip export restrictions. These divergences suggest tactical opportunities in high-momentum sectors while encouraging caution in areas facing regulatory or demand headwinds.

Economic News

Recent macroeconomic releases underscore a mixed but broadly constructive outlook. Inflation across the eurozone remains contained, with the latest CPI reading at 129.7 and year-over-year inflation at 2.1, easing pressure on policymakers. The ECB’s latest review highlights that eurozone banks remain profitable and stable, while Spain’s GDP growth has moderated to 0.6, and retail sales growth has softened to 4.2. Eurozone consumer confidence has improved to -14.2, a positive signal for household spending.

Upcoming key economic releases include Eurozone Industrial Production, GDP figures, Germany’s ZEW Economic Sentiment, and France’s Consumer Price Index. These data will be pivotal in shaping investor expectations for growth and inflation in the coming weeks.

Economic Events

This week’s macroeconomic calendar is eventful, with investors closely monitoring scheduled releases such as the ECB General Council Meeting, Eurozone Construction Output, and consumer confidence data. In Spain, indicators such as the Producer Price Index, Consumer Confidence, and Retail Sales will be released, with retail sales (YoY and MoM) and inflation figures (CPI, HICP, and Core Inflation) expected to have a significant impact on market direction. Central bank meetings, including those of the ECB and the U.S. Federal Reserve, remain in focus and could influence rate-sensitive sectors and overall risk appetite.

Market Sentiment

Overall sentiment in European equity markets is cautiously optimistic. Sustained capital flows into blue-chip indices such as the Euro STOXX 50 and FTSE MIB are underpinned by stable credit conditions and expectations of accommodative central bank policies. The stabilization of inflation and improvement in current account balances provide a supportive macroeconomic backdrop, moderating downside risks from global uncertainties. Investors are adopting a sector-rotational approach, favoring financials, consumer staples, and industrials, while maintaining vigilance regarding autos and technology due to regulatory and demand risks.

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