European Stocks Hold Muted Momentum

European stock indices closed flat on Thursday, extending the muted momentum from the two prior sessions as concerns of energy-driven inflation weighed against positive corporate news. The Euro STOXX 50 closed flat at 6,268 and the STOXX Europe 600 closed flat at 643. Luxury brands gained on further support from the strong Richemont earnings yesterday, with LVMH and Hermes adding 1.5%. Also, Publicis rose 3% after raising its full-year guidance. On the other hand, higher gas prices pressured utilities and magnified uncertainty for the power-hungry AI infrastructure producers and operators. Enel, Schneider, and Siemens Electric dropped between 2.5% and 1.5%. For energy producers, TotalEnergies fell 1.5% after its earnings preview indicated that Q2 profits are expected to benefit from higher oil prices, although LNG earnings are projected to decline sharply.

European stocks were subdued on Thursday, with the STOXX 50 falling 0.2% and the STOXX 600 slipping 0.3%, as investors digested a fresh round of corporate earnings and company updates. Meanwhile, oil prices eased despite the ongoing hostilities between the US and Iran. Utilities and consumer staples were among the worst performers. TotalEnergies fell 1.6% after its earnings preview indicated that Q2 profits are expected to benefit from higher oil prices, although LNG earnings are projected to decline sharply. ABB lost 2% after announcing a $5.5 billion acquisition of British automation company Rotork. Experian tumbled more than 5% after its results disappointed investors, while the company maintained its full-year guidance. On the upside, ASML Holding advanced 2.6%, supported by strong quarterly results from Taiwan Semiconductor Manufacturing. Publicis gained 1.3% after raising its full-year guidance.

European equity markets were poised to open higher on Thursday as softer US inflation data eased concerns about an imminent Federal Reserve interest rate hike. However, investor sentiment remained cautious amid a global selloff in semiconductor stocks, fueled by persistent concerns over the sustainability of the artificial intelligence trade. In Europe, data showed the UK economy expanded 0.1% month-on-month in May, rebounding from a 0.1% contraction in April and matching market expectations. On the corporate front, investors awaited earnings reports from ABB Group and Publicis Groupe. In premarket trading, Euro Stoxx 50 futures rose 0.4%, while Stoxx 600 futures gained 0.1%.