by Pauline Foret
(Reuters) – European stock markets ended lower on Thursday after a deluge of corporate results and economic indicators as uncertainty reigned over the profitability of AI spending and the political future of the United States.
In Paris, the CAC 40 ended down 1.05% at 7,350.37 points. In Frankfurt, the Dax fell by 1.03% and in London, the FTSE 100 by 0.61%.
The EuroStoxx 50 index closed down 1.34%, the FTSEurofirst 300 1.11% and the Stoxx 600 1.27%.
The earnings season, which has seen many companies report figures below expectations, is weighing heavily on market sentiment. Heavyweights such as TotalEnergies, BNP Paribas and Anheuser-Busch InBev are sliding on the stock market after missing estimates, taking most of the European sub-indexes with them.
Across the Atlantic, Meta’s latest warnings about accelerating spending on generative artificial intelligence (AI) are dragging the S&P-500 and the Nasdaq down.
“The results were a bit disappointing for investors and that translated into weakness in the Nasdaq, adding to weak sentiment in the Stoxx 600,” said Daniela Hathorn, senior markets analyst at Capital.com.
On the macro side, the American election also brings its share of concerns, with the presidential race promising to be extremely close. For several weeks, the markets have been betting on a victory for Donald Trump against Kamala Harris, while opinion polls are uncertain.
“Trump is threatening a lot of tariffs – let’s see what that means for international trade. We’re likely to see a drop in productivity at a lot of companies that have exposure to the US, so investors are worried.” , explained Daniela Hathorn.
Several economic indicators published during the session also indicated a surprise recovery in inflation in the euro zone and retail sales in Germany, as well as a strengthening in household spending in the United States.
VALUES
In Paris, BNP Paribas lost 4.75% after its consumer credit and automobile leasing activities in the third quarter disappointed the markets.
Its rival, Société Générale, took 11.27% after reporting on Thursday better than expected results in the third quarter, driven by the rebound in retail banking and the dynamics of equity businesses, while announcing a reshuffle of his direction.
Spie lost 5.29%, the organic and production growth of the French group having notably disappointed analysts’ expectations.
In Zurich, SoftwareOne fell 38.96% after sharply lowering its annual turnover forecasts on Thursday.
Against a backdrop of uncertainty about the future of trade relations between the United States and Europe, the retail sales sector fell by 4.14%.
A WALL STREET
At closing time in Europe, Wall Street widened its losses, with the Dow Jones dropping 0.67%, the Standard & Poor’s 500 1.46% and the Nasdaq Composite, particularly sensitive to technology stocks, 2.40%.
On the value side, the technology sector is faltering after the results of Microsoft and Meta, which lost 5.64% and 4.0% respectively. Nvidia, Amazon, Alphabet and Apple lost between 0.5% and 4.3%.
Uber lost 11.26% after its quarterly results, while Estée Lauder collapsed 20.29% after withdrawing its revenue forecast for 2025.
The markets are now turning to Amazon and Apple, the last two of the “megacaps” to publish their results this week.
TODAY’S INDICATORS
Preliminary data for harmonized inflation in France stood at 1.5% in October, while German retail sales posted surprise growth in September. In the euro zone, inflation accelerated again to reach 2% in October.
Across the Atlantic, unemployment claims fell unexpectedly, standing at 216,000 in the week to October 26 while investors were counting on 230,000, while the PCE price index increased by 0.2% on a month in September, in line with expectations.
CHANGES
The dollar strengthened somewhat on Thursday after data suggested easing pressure on consumer prices, bolstering bets that the Federal Reserve could cut key rates by 25 basis points next week.
The dollar gained 0.13% against a basket of reference currencies.
After data confirming a further rise in inflation in the euro zone, the single currency gained 0.03% to 1.0858 dollars.
RATE
The latest economic indicators having reassured investors about the possibility that the Federal Reserve will continue its gentle easing cycle, bond yields are up again this Thursday.
The yield on ten-year Treasuries gained 2.8 basis points to 4.2924%, and two-year treasuries gained 1.6 basis points to 4.1702%.
The yield on the ten-year German Bund is up 0.8 basis points to 2.4000% and two years 0.6 basis points to 2.3220%.
OIL
Oil prices are rising on Thursday as investors digest rising US demand and reports that OPEC+ countries plan to delay their planned production increase.
Brent gained 0.79% to $73.12 per barrel and American light crude (West Texas Intermediate, WTI) gained 0.69% to $69.08.
TO BE CONTINUED FRIDAY NOVEMBER 1: []
Investors are awaiting the monthly employment report in the United States on Friday afternoon.
In terms of results, the American oil sector will be first in line, with results from Exxon Mobil and Chevron expected during the day.
(Written by Pauline Foret)
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