European stock exchanges lost ground on Friday under the weight of geopolitical uncertainties in the Middle East, while investors closely watched a new series of corporate earnings reports.
At the close, the Stoxx Europe 600 index lost 0.6% to 610.65 points, bringing its weekly losses to 2.5%. In Paris, the CAC 40 and the SBF 120 both declined by 0.8%. However, the DAX 30 in Frankfurt fell by 0.1% and the FTSE 100 in London dropped by 0.75%.
As mid-session approached, most indices were advancing. While the Dow Jones was down 0.1%, the S&P 500 gained 0.8% and the Nasdaq Composite rose by 1.5%.
The end of the session in Europe was marked by the U.S. Justice Department dropping its charges against Federal Reserve Chair Jerome Powell, a decision expected to facilitate the entry of his designated successor, Kevin Warsh.
Official Iranian media reported on Friday that Foreign Minister Abbas Araqchi would be visiting Pakistan in the evening. The planned discussions might be limited to bilateral exchanges with Pakistani authorities, and it is unclear at this stage if they will lead to a resumption of dialogue with the United States.
The arrival of the USS George H. W. Bush in the region is seen as a sign that tensions will escalate before easing. As a Russian playwright Anton Chekhov noted, if a gun appears in the first act, it is likely to be used at some point in the play, highlights the oil specialist PVM on Friday. The firm also points out that as long as the strait remains closed, the global economy is deprived of 10% to 15% of the needed oil supply.
Around 5:50 pm, the June contract for North Sea Brent oil was up by 0.2% at $99.67 per barrel.
The war in the Middle East has weighed on the confidence of French consumers and German business leaders. Household confidence in France deteriorated in April, with the national statistical institute reporting a major decrease in the household confidence index. In Germany, the business climate declined for the second consecutive month in April, according to the IFO institute.
In addition to geopolitics, the session was impacted by corporate earnings reports. Among notable reactions, investors responded negatively to reports from Saint-Gobain and Valeo, while Accor, Clariane, Seb, and Spie’s reports were well-received.
In the foreign exchange market, the euro gained 0.2% against the U.S. dollar, reaching $1.1714.
Stocks to Watch:
- ACCOR (+1.1%): Reported increased revenues in the first quarter, with activity in the UAE affected by the Middle East war.
- CLARIANE (+5.8%): Confirmed their financial targets for 2026 after revenue growth in the first quarter.
- FORVIA (-3.8%): Indicated a short-term expected sale of interior elements activities, maintained 2026 financial objectives.
- LISI (+3.4%): Confirmed annual forecasts with aeronautical growth offsetting the automotive sector decline.
- Nexity (+1.55%): Reported decreased revenue but increased reservations and confirmed annual objectives.
- SAINT-GOBAIN (-0.6%): Confirmed 2026 margin goal despite lower first quarter revenue.
- SEB (+6.9%): Noted increased revenue and operational results in the first quarter, attributing growth to organic sales and lower operational costs.
- SPIE (+6.4%): Expects financial indicators to improve despite a decline in production in the first quarter.
- URW (-0.6%): Confirmed profitability goal for 2026 after activity decline in the first quarter.
- VALEO (-4.3%): Confirmed 2026 objectives despite first quarter revenue decline.
Source: Agefi-Dow Jones The financial newswire
