European equities tumbled for a fourth consecutive session, dragged down by disappointing earnings reports from industry heavyweights ASML and Renault. The Stoxx Europe 600 Index slipped 0.2%, marking its longest losing streak in a month.
French automaker Renault saw shares plunge 16% – the steepest single-day drop in over five years – after slashing its full-year profit margin outlook. Dutch semiconductor equipment giant ASML plummeted 6.7% following its decision to withdraw next year's growth forecast amid global trade tensions.
Outperforming regional peers, Britain’s FTSE 100 Index gained strength as surprisingly robust inflation data pushed sterling higher. The inflation reading hit its highest level since January 2024.
Persistent uncertainty over U.S. trade policies continues to hinder European markets. President Trump indicated potential tariffs on pharmaceutical products by month-end, with semiconductor duties possibly following. Market participants now scrutinize whether earnings season can reignite momentum.
According to Bloomberg Intelligence, analysts project MSCI Europe companies will report a 4.8% year-over-year decline in Q2 profits. Panmure Liberum strategist Susannah Cruz warned of further disappointments: "Forecasting remains exceptionally challenging," she noted, adding, "While markets may have priced in pessimism for consumer goods, healthcare, and resources sectors, significant downside risks emerge if China’s economy weakens further."
In a bright spot, luxury group Richemont climbed 2.4% after beating sales expectations, defying broader sector weakness.
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