European Stocks Slip as Investors Digest Earnings and Geopolitical Risks
European stock markets traded slightly lower on Thursday as investors assessed a fresh wave of quarterly corporate earnings alongside rising geopolitical tensions.
By 03:02 ET (08:02 GMT), Germany’s DAX declined 0.3%, France’s CAC 40 slipped 0.2%, and the U.K.’s FTSE 100 fell 0.2%.
Earnings Season Remains in Focus
The earnings calendar remained busy, with roughly 60% of European companies having exceeded profit expectations so far this quarter.
Pernod Ricard reported a 5% drop in second-quarter like-for-like sales, reflecting continued weak consumer demand and inventory reductions in the United States and China. However, the decline was less severe than the 7.6% contraction recorded in the prior quarter, supported by stronger performance in India and travel retail.
Rio Tinto posted flat underlying earnings for 2025, as higher copper and aluminium volumes and improved cost controls offset softer iron ore prices.
Renault reported a net loss of €10.93 billion for 2025 after booking a €9.3 billion non-cash charge related to a change in the accounting treatment of its Nissan stake. Despite the headline loss, the French automaker’s operating performance remained stable, with revenue rising 3%.
Nestlé recorded a 17% decline in annual net profit for 2025, pressured by restructuring costs, asset writedowns, and the impact of a December infant formula recall. Profit margins also contracted sharply.
Zurich Insurance delivered a record operating profit of $8.9 billion for 2025, up 14% year-on-year, driven by stronger property and casualty underwriting and growth across all major business segments.
Airbus reported slightly stronger fourth-quarter profits but warned that 2026 aircraft deliveries could fall short of expectations due to ongoing engine shortages.
Air France-KLM posted its first operating result above €2 billion, supported by higher revenues and lower fuel costs despite rising airport and labor expenses.
German packaging equipment manufacturer Krones exceeded analyst expectations on profitability in the fourth quarter, although revenue came in slightly below forecasts.
Geopolitical Tensions Weigh on Sentiment
Outside of corporate developments, geopolitical risks remained elevated.
Russia and Ukraine held their third U.S.-mediated talks of 2026 this week, but no progress was made on key issues, including territorial disputes in the eastern Donetsk region.
At the same time, U.S.-Iran nuclear negotiations in Geneva showed limited advancement. U.S. Vice President JD Vance indicated that Washington is considering whether to continue diplomatic engagement or pursue alternative measures.
Satellite imagery reportedly showed further development at a sensitive Iranian military site, adding to regional concerns.
Oil Prices Extend Gains on Supply Concerns
Oil prices climbed further on Thursday as rising military activity in the Middle East heightened fears of supply disruptions.
Brent crude futures advanced 1% to $71.04 per barrel, while U.S. West Texas Intermediate crude gained 1.1% to $65.75 per barrel. Both benchmarks had closed more than 4% higher in the previous session, marking their strongest settlements since late January.
Concerns over energy supply were reinforced by reports of increased military and naval activity in the Persian Gulf, as well as stalled Russia-Ukraine negotiations.
Additional support came from U.S. inventory data. The American Petroleum Institute reported a decline of approximately 609,000 barrels in crude stockpiles for the week ending February 13. Official figures from the Energy Information Administration are expected later Thursday.
With corporate earnings, geopolitical risks, and energy markets all in focus, European investors remain cautious heading into the next trading sessions.
