European markets close in red, while FTSE 100 posting its biggest one-day gain in eight months as UK inflation cools

Indices

European equity markets continue to trade near record or multi-year highs, reflecting a mix of resilience and tactical consolidation across major benchmarks. The FTSE MIB Index (FTSEMIB.MI) is trading at 44.08K, advancing by 89.72 and maintaining a STRONG_LONG micro-trend. This ongoing momentum suggests institutional buy interest, especially in banking and energy sectors. The DAX Performance Index (^GDAXI) stands at 23.95K, registering a modest decline of -123.19 and maintaining a FLAT trend, which indicates some market indecision after recent gains.

France’s CAC 40 (^FCHI) is at 8.09K, down -18.11 and also tracking a FLAT micro-trend, mirroring investor caution amid ongoing political and policy uncertainties. The FTSE 100 (^FTSE) trades at 9.78K, posting a gain of 96.65 and presenting a FLAT trend, which implies a pause following recent upward momentum. Spain’s IBEX 35 (^IBEX) is at 16.91K, slightly lower by -7.8 but still near its highs, with a FLAT trend as strong banking and resources performance continues to underpin the index.

The Euro STOXX 50 (^STOXX50E) posts 5.68K, with a decrease of -37.52 but retaining a STRONG_LONG trend. This persistent strength signals ongoing bullish conviction in Eurozone blue-chip equities, highlighting continued capital inflows and constructive technical conditions.

Stocks

Today’s trading is marked by pronounced sector rotation. Banking and basic resources lead the outperformers, with Spanish banks Sabadell and Caixabank delivering year-to-date returns of 67 and 47, fueling IBEX 35 resilience. Steel producers such as ArcelorMittal, Aperam, Thyssenkrupp, and SSAB have each gained over 3, buoyed by regulatory changes in steel import quotas. In contrast, the automotive and tech sectors are under pressure; for instance, BMW (BMW:GR) has fallen -8.9 following a weak earnings outlook. Notably, Inditex (ITX.MC) surged 7 after strong winter sales, helping the IBEX 35 reach new highs. This sector rotation suggests traders should maintain a tactical, selective approach, favoring banking and basic resources while exercising caution in autos and technology.

Economic News

Recent macroeconomic data present a nuanced, but generally constructive, environment for European equities. Eurozone inflation remains subdued, with the Consumer Price Index at 2.1, which reduces immediate pressure on the European Central Bank to tighten monetary policy. Eurozone consumer confidence improved by 0.7 to -14.2, surpassing expectations and supporting discretionary sectors. Spain’s GDP growth eased to 0.6 from 0.8, while retail sales slowed to 4.2, indicating some cooling of consumer demand. The European Commission has upgraded its 2025 eurozone growth forecast to 1.3 from 0.9, further supporting the constructive outlook.

Economic Events

This week’s calendar is rich with high-impact data releases and central bank meetings that could drive volatility. Key events include the Eurozone Industrial Production and GDP data for Germany and the Eurozone, Germany’s ZEW Economic Sentiment Index, and France’s Consumer Price Index. For Spain’s IBEX 35, Producer Price Index, Consumer Confidence, and Retail Sales releases are particularly relevant. Central bank meetings are in sharp focus, with the upcoming European Central Bank interest rate decision and the U.S. Federal Reserve’s FOMC session—where a widely anticipated 25 basis point rate cut could significantly affect rate-sensitive sectors and broader risk sentiment.

Market Sentiment

Market sentiment across Europe is best described as cautiously optimistic. Sustained inflows into blue-chip indices such as the Euro STOXX 50 (^STOXX50E) and FTSE MIB Index (FTSEMIB.MI) are underpinned by stable credit conditions and expectations of accommodative central bank policy. Outperformance in banking and basic resources is compensating for ongoing weakness in autos and technology, leading to a tactical, sector-rotational approach among investors. The prevalence of FLAT trends in several indices signals a wait-and-see stance, as market participants remain vigilant ahead of major data and policy announcements. This environment favors selectivity and active risk management while maintaining an overall constructive outlook on leading European benchmarks.

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