European stock markets experienced gains on Monday, buoyed by a wave of positive corporate earnings and anticipation surrounding key economic data releases. At 03:15 ET (07:15 GMT), major European indexes showed upward momentum, with the DAX index in Germany trading 0.4% higher, the CAC 40 in France up 0.3%, and the FTSE 100 in the U.K. climbing 0.4%.
Investor sentiment received a boost from stronger-than-expected earnings reports from U.S. tech giants Microsoft and Alphabet, which had triggered a rally on Wall Street the previous Friday. This positive momentum spilled over into European markets, contributing to the overall bullish sentiment.
Despite the ongoing European earnings season, where companies report their quarterly financial results, attention remained focused on significant economic indicators. Of particular interest was the release of German inflation data, given Germany’s prominent position within the eurozone economy.
In terms of corporate earnings, several notable companies reported their financial results. Vivendi, the French media group, announced a strong increase in first-quarter revenue, driven by robust growth across its core businesses such as Canal+ Group, Lagardere, and Havas. Additionally, the company provided updates on its planned split into four separate entities, indicating progress in its feasibility study.
Another noteworthy report came from Philips, the Dutch medical devices manufacturer, which delivered first-quarter results largely in line with expectations. However, the company also disclosed a $1.1 billion settlement in the U.S. related to its Respironics ventilators and affirmed its full-year guidance, contributing to a positive market response.
Meanwhile, BBVA, the Spanish lender, exceeded earnings forecasts with its first-quarter net profit, driven by increased lending income in Mexico and Spain. This trend was expected to continue throughout the year, particularly in its home country.
However, Deutsche Bank, Germany’s largest lender, faced challenges as its stock fell after news emerged of a potentially costly lawsuit stemming from its acquisition of Postbank. The lawsuit could result in significant financial liabilities for the bank, weighing on investor sentiment.
In terms of economic news, Spanish consumer prices rose by 3.3% on an annual basis in April, remaining above the European Central Bank’s medium-term inflation target of 2%. Attention shifted to the release of German state CPI data later in the session, as it would provide further insights into inflationary pressures within the eurozone.
Overall, market participants closely monitored economic indicators, corporate earnings reports, and geopolitical developments, such as peace talks between Israel and Hamas, which contributed to fluctuations in oil prices. Despite these uncertainties, optimism prevailed in European stock markets, supported by positive earnings momentum and expectations of accommodative monetary policy measures.