European Stocks Close Mostly Weak As Investors React To Earnings

(RTTNews) - European markets closed mostly lower on Thursday as investors reacted to a slew of earnings announcements and digested the latest batch of economic data from the region, and also followed the developments on the trade front.

On Wednesday, the Federal Reserve left the interest rate unchanged as widely expected. Fed Chair Jerome Powell's cautious tone, citing a strong labor market, high inflation and slowing growth, has somewhat ruled out a rate cut in September as well.

U.S. President Donald Trump announced a 25% tariff on Indian imports, but excluded copper from a planned 50% tariff.

The pan European Stoxx 600 closed down 0.75%. Germany's DAX and France's CAC 40 lost 0.81% and 1.14%, respectively. The U.K. market, which spent much of the day's session in positive territory, suffered a setback in the final hour to close slightly week. The FTSE 100 edged down 0.05%.

Switzerland's SMI ended down 0.8%. Among other markets in Europe, Denmark, Finland, Iceland, Ireland, Netherlands, Poland and Sweden ended higher.

Belgium, Greece, Norway, Portugal, Russia, Spain and Turkiye closed weak.

In the UK market, Rentokil Initial soared 9.5% despite the company reporting that its profit before income tax for six-month period ended 30 June 2025 declined to $216 million from $294 million last year. The company expects to deliver fiscal year 2025 results in line with market expectations.

Rolls-Royce Holdings surged 8.5% after the company reported strong results and raised its earnings guidance. The company's first half profit before taxation surged to 4.84 billion pounds from last year's 1.42 billion pounds. Basic earnings per share were 52.38 pence, up from 13.71 pence a year ago.

Further, the company raised fiscal 2025 guidance, and now expects underlying operating profit of 3.1 billion pounds to 3.2 billion pounds. The engine maker previously expected underlying operating profit of 2.7 billion pounds to 2.9 billion pounds.

St. James's Place zoomed nearly 12%. Melrose Industries, Babcock International, Prudential, Endeavour Mining, Croda International, Polar Capital Technology Trust, Weir Group, RightMove and IAG all ended with strong gains.

Shell gained 1.2% as second-quarter profit beat expectations and the company said it would buy back $3.5 billion of shares over the coming three months.

Mondi tanked more than 12% as profit before tax fell to 247 million euros from last year's 296 million euros. Basic earnings per share were 38.6 euro cents, compared to 44.5 euro cents last year.

Antofagasta closed nearly 6% down. Diageo, Anglo American Plc., Glencore, Rio Tinto, Whitbread, Vodafone Group, GSK, BT Group and Intercontinental Hotels Group also declined sharply.

In the German market, Siemens Healthineers, Zalando, Puma, Adidas, Infineon and Bayer lost 3 to 4.5%.

Mercedes-Benz, Sartorius, BASF, Siemens, Volkswagen, Brenntag, RWE, Fresenius, Beiersdorf, Fresenius Medical Care and Deutsche Telekom closed lower by 1 to 2.5%.

Heidelberg Materials, Symrise, Porsche, MTU Aero Engines, Commerzbank, E.ON, Deutsche Boerse and Allianz closed with sharp to moderate gains.

German defense electronics maker Hensoldt rallied nearly 4% as it reported solid revenue growth and a record order backlog in its H1 2025 results. However, the stock pared some gains subsequently.

In the French market, Accor closed nearly 10% down, despite reporting a larger-than-expected rise in H1 earnings. Sanofi is down with a loss of about 2.1% after the company's earnings fell short of expectations. Veolia Environment is down nearly 2% after reporting a decline in first-half revenue.

Sanofi lost nearly 8% after the company's earnings fell short of expectations. Veolia Environment is down nearly 2% after reporting a decline in first-half revenue. . Bouygues closed lower by 7.2%. Hermes International, Schneider Electric and Pernod Ricard ended down 4 to 5.2%.

Vinci, ArcelorMittal, STMicroElectronics, Stellantis, LVMH, Edenred, Airbus, Renault and Capgemini lost 1 to 2.7%.

Air France-KLM moved up sharply, lifted by higher second-quarter profits. Legrand gained about 4% on impressive earnings.

Societe Generale rallied nearly 7% thanks to stronger-than-expected second-quarter earnings. Safran gained more than 3%, lifted by strong first-half earnings and full-year revenue guidance.

Eurofins Scientific, Legrand and BNP Paribas gained 1.2 to 2%.

On the economic front, data from Destatis showed Germany's import prices fell by 1.4% year-on-year in June, following a 1.1% decline in May, falling for the third consecutive month. On a monthly basis, import prices were unchanged, following a 0.7% drop in May.

Germany's seasonally adjusted unemployment rate held steady at 6.3% in June, coming in below a 6.4% forecast, but still remained at the highest level in nearly five years.

Germamy's flash inflation data for July is due later in the day. Consumer price inflation is forecast to ease slightly to 1.9% from 2% in June.

Data from INSEE showed France's harmonized inflation remained stable in July and stayed well below the European Central Bank's 2% target due to weaker energy prices.

The harmonized index of consumer prices rose 0.9% year-on-year in July, the same rate as seen in June. The rate was expected to slow to 0.8%.

Likewise, consumer price inflation remained unchanged at 1% in July, in line with expectations.

The statistical office said producer prices declined at the slowest pace since February. Producer prices slid 0.2% month-on-month in June, following May's 0.9% decrease.

On a yearly basis, producer prices advanced 0.2% after remaining flat in May, data showed.