European indices mixed as luxury sector weighs and earnings take center stage

Indices

European equities are exhibiting divergent trends as of January 29, 2026, reflecting a nuanced market sentiment amid ongoing earnings season and sector-specific volatility. The FTSE 100 (UK) is trading at 10.15K, marking a decline of -53.37 or -0.52%, driven by weakness in energy and mining shares. The DAX (Germany) has slipped to 24.82K, down -71.65 or -0.29%, with underperformance noted in automotive and financial stocks. The CAC 40 (France) is experiencing the sharpest drop, trading at 8.07K, down -86.14 or -1.06%, heavily impacted by steep corrections in luxury goods names. In contrast, the Euro Stoxx 50 stands marginally higher at 5.6K, up 2.7 or +0.05%, indicating cautious optimism among pan-European blue chips. This pattern suggests a sector-rotation dynamic and selective risk-taking as investors process earnings data.

Stocks

Today’s trading spotlight is on high-volume names such as Intesa Sanpaolo SpA (ISP), which has seen 44.05M shares exchanged at a price of €5.87, down -1.43%. Banco Santander (SAN), Enel (ENEI), Stellantis NV (STLAM), and Eni SpA (ENI) also show significant activity, with mixed price action reflecting sector-specific news flow. Notably, luxury conglomerates Louis Vuitton (LVMH), Hermes International (HRMS), and Kering (PRTP) are among the session’s steepest decliners, with LVMH plummeting -7.89% to €542.8, suggesting a reassessment of luxury demand amid macro uncertainty. Conversely, Infineon (IFXGn), Pernod Ricard (PERP), and TotalEnergies SE (TTEF) are leading the gainers, hinting at renewed interest in defensive and technology-related plays.

Economic News

Recent macroeconomic updates indicate further challenges for European growth. The European Commission has revised 2025 GDP forecasts downward, now expecting EU growth at 1.5% and Eurozone growth at 1.3%, with the IMF projecting an even more subdued 0.8%. Persistent inflation, especially in services and across Central and Eastern Europe, is underscored by a Eurozone inflation forecast of 2.1%, remaining above the ECB’s target. Manufacturing remains in contraction, with the latest Eurozone PMI at 45.1, signaling ongoing industrial headwinds.

Economic Events

Key economic events for January 29, 2026, include several high-profile earnings releases from global blue chips, with a particular focus on SAP SE (SAP) in Europe, which could set the tone for the region’s tech sector. No major economic data releases or central bank decisions are scheduled that could immediately sway index directions, but ongoing monitoring of macroeconomic and geopolitical developments remains crucial.

Earnings Events

A robust earnings calendar is in focus today, with SAP SE (SAP) reporting results, along with major international names such as Mastercard Incorporated (MA), Caterpillar Inc. (CAT), Thermo Fisher Scientific Inc. (TMO), and Honeywell International Inc. (HON). The outcomes of these releases, especially from SAP SE, are likely to drive sector rotation and influence sentiment across technology, industrials, and financials, possibly amplifying volatility in correlated indices.

This Week's IPOs

There are no significant IPOs scheduled in Europe for this week, suggesting limited primary market activity and a focus on secondary market trading.

Market Sentiment

Overall sentiment remains cautious and selective. The marginal gain in the Euro Stoxx 50 signals a degree of underlying resilience, while sharp declines in luxury and cyclical sectors suggest heightened sensitivity to earnings disappointments and macro risks. Defensive sectors and technology are seeing renewed interest as investors look for relative safety and growth amid an uncertain backdrop.

Recommendations

Traders should closely monitor sector rotations, particularly the pronounced weakness in luxury and cyclicals versus pockets of strength in technology and defensive names. Consider tightening stop-losses on indices and stocks exposed to earnings risk or macro headwinds, especially in the CAC 40 and DAX. Look for potential long opportunities in outperforming sectors such as technology and energy, while remaining nimble to react to earnings-driven volatility. Maintain a disciplined approach to position sizing and risk management as headline risk remains elevated.