Earnings momentum lifts European markets amid trade uncertainty

Fidelity European Trust

European equities are exhibiting cautious optimism as robust corporate earnings provide a counterbalance to ongoing global trade tensions. Investors are closely monitoring company performances while awaiting pivotal economic indicators and central bank decisions.

On Tuesday, the STOXX 50 and STOXX 600 indices both registered a modest 0.1% increase, reflecting a market buoyed by positive earnings reports. Continental’s shares rose approximately 4% following a four-year high in sales. Danish wind turbine manufacturer Vestas experienced a 6% uptick after returning to profitability in the first quarter. Fashion retailer Hugo Boss saw its stock climb nearly 7% due to surpassing revenue expectations.

Conversely, Philips’ shares declined by 1.8% after the company lowered its profitability outlook, and Covestro’s stock dipped 0.2% following a reduction in its full-year earnings guidance. In the M\&A sphere, Deliveroo’s shares increased by 2% after U.S.-based DoorDash announced a £2.9 billion acquisition of the British food delivery firm. BP’s stock gained about 2.8% amid reports of Shell evaluating a potential takeover, although Shell’s shares fell by 1%.

These earnings developments occur against a backdrop of global economic uncertainty. Investors are particularly attentive to trade negotiations involving the U.S. and several Asian countries, as well as the upcoming monetary policy decision from the Federal Reserve. The interplay between strong corporate performances and macroeconomic factors continues to shape market sentiment.

Fidelity European Trust PLC (LON:FEV) aims to be the cornerstone long-term investment of choice for those seeking European exposure across market cycles.

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