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Reuters
a day ago
- Business
- Reuters
European stocks rise on Safran, Rolls-Royce boost amidst earnings flurry
July 31 (Reuters) - European shares edged higher on Thursday, helped by a slate of upbeat corporate results from Safran and Rolls-Royce, with investors keeping an eye on last-minute trade deals after U.S. President Donald Trump issued a blitz of tariff announcements. The French aerospace group Safran < opens new tab rose 4.8% after raising its full year profit outlook, while British aero-engineer Rolls-Royce RR.L, opens new tab rallied 8.4% after raising, opens new tabits full-year outlook for operating profit and free cash flow. Shares of both firms hit all-time highs, respectively. The pan-European Stoxx 600 index (.STOXX), opens new tab was up 0.4% by 0810 GMT with all major regional indexes in the green. The STOXX 600 index is on track to end the month 2% higher as easing trade worries, better-than-expected U.S. and European economic data and largely upbeat earnings reports bolstered sentiment. "What's driving the equities markets is that we are at the peak of the earnings season," said Christoph Berger, CIO European equity at Allianz Global Investors. "The perspective of most European market participants is now more on 2026 and that will be the time when you see the impact of the fiscal stimulus in Germany but also more measures related to European sovereignty." Ahead of the August 1 deadline, U.S. President Donald Trump released fresh levies ranging from updates on copper tariffs, goods from Brazil, South Korea and India as well as an end to exemptions for small-value overseas shipments. After Trump stuck a trade deal framework with the EU over the weekend, analysts' outlook for second-quarter earnings has improved. As of Tuesday, STOXX 600 companies are likely to report growth of 1.8% in second-quarter earnings, a large improvement from the 0.3% fall analysts had expected a week ago, according to LSEG I/B/E/S data. Euro zone banks (.SX7E), opens new tab continued their upward momentum, adding 1.8%, boosted by Societe Generale ( opens new tab raising its annual profit target on Thursday. The French bank was among top gainers on the index, advancing 6.8%. Standard Chartered (STAN.L), opens new tab reported a higher-than-expected rise in first-half pretax profit, while Spanish bank BBVA ( opens new tab added 7.6% after second-quarter net profit beat expectations. Energy giant Shell (SHEL.L), opens new tab gained 2.3% after the company beat profit expectations for the quarter and kept buybacks steady. Rival BP (BP.L), opens new tab rose marginally. Anheuser-Busch InBev ( opens new tab slumped 9.4% to the bottom of the index after the beer giant reported a fall in volumes, dragged back by weak sales in China and Brazil. Blowout results from Microsoft (MSFT.O), opens new tab and Meta Platforms (META.O), opens new tab overnight are set to power Wall Street on Thursday, ahead of reports from Apple (AAPL.O), opens new tab and (AMZN.O), opens new tab. Investors will also wait for Eurozone unemployment data for June and preliminary CPI data from France and Germany expected later in the day.
Yahoo
5 days ago
- Business
- Yahoo
5 silly earnings season stock price moves!
Earnings season is moving along swimmingly. All things considered, this summer's reporting period could have really sucked. Every CEO could've blamed Trump trade tensions for misses in any parts of the business. Meanwhile, the results could've straight up not justified the valuations we are seeing in a hot market. About 135 S&P 500 (^GSPC) companies, or 29% of the index's market cap, have reported earnings at the time of this writing. Sales and earnings have increased by a solid 6.5% and 7.2%, respectively. The average stock price has increased 1% post-results. But sometimes Mr. Market gets it wrong during earnings season, in my view. The market will overly punish a company for something perceived as a big deal in the moment but minor in the grand scheme. Or, it won't reward a company enough for strong results that feed into a long-term investment case. Here are five reactions this week from earnings that left me scratching my head. IBM What more could the market want from Big Blue? Software and infrastructure sales are up 10% and 14%, respectively. The company increased its full-year operating margin expectations. CFO Jim Kavanaugh told me the company is finding added cost savings, lifting the margin outlook. Further, IBM has an AI story to tell — and it's a good one! "I think you're starting to see the beginnings of scale of generative AI, which is accelerating. Last quarter, we did about six billion dollars [of AI business]. Now we're over seven and a half billion," Kavanaugh added. IBM shares finished Thursday's session (morning after earnings) down 6%. "We would recommend opportunistic purchases for defensive-minded investors ($310 12-month target), although post-report selling may persist for a short period," Stifel analyst David Grossman called out. AT&T AT&T's (T) stock barely finished in the green on Wednesday's earnings day. Similar to IBM, what else could investors have been looking for? The company gained postpaid phone subscribers in the second quarter, while rival Verizon lost customers (though T-Mobile stole the telecom show — see below). Free cash flow — always an important metric for a telecom — rose $400 million year over year. And AT&T called out a $6.5 billion to $8 billion cash tax savings from 2025 to 2027 as a result of the One Big Beautiful Bill Act. "We are investing $23 to $24 billion on a go forward basis each year into our network. Historically, we would have had to amortize that capital and take those deductions over time. The bonus depreciation provisions in the bill allow us to expense those immediately," AT&T CFO Pascal Desroches told me. Expect the company to spend a good chunk of these savings on stock buybacks. The stock got slapped with a top pick call by JPMorgan on Thursday. "Long-term, we believe AT&T convergence playbook, accelerating fiber build to 50m+ organic locations, owner economics, and go-to-market scale will allow the company to derive industry-leading unit economics," JPMorgan analyst Sebastiano Petti said. Chipotle I get why Chipotle's (CMG) stock got shredded by 13% post-results. Chipotle is valued as a growth stock, and growth took a hit in the second quarter. But I don't believe there's anything fundamentally wrong. The company is still aggressively opening new stores and has a very devoted customer base. I fancy it just needs to market its value proposition, which it plans to do more of in the third quarter. Overlooked on the earnings call is Chipotle noting that sales have returned to growth in July. It's planning to release limited-time offerings in 2026 at a faster pace. And I like how the company is doubling down on restaurant technology. "2Q was also CMG toughest lap for 2024 share gains, and, even if there is the opportunity for more ownership of recent trends/urgency in tone, we believe it is indeed building/increasingly deploying a marketing/innovation toolbox that will drive growing confidence in a more stable same-store sales trajectory into 2H and beyond," Citi analyst Jon Tower wrote. T-Mobile T-Mobile's (TMUS) stock gained a solid 5.8% on Thursday after reporting on Wednesday post-market close. I think that is 5% less than the quarter deserved. The telecom giant easily beat analyst estimates. It gained the most net new customers compared to its competitors. T-Mobile CEO Mike Sievert told me on Yahoo Finance that the company's steady value messaging is helping it gain market share. "T-Mobile's value proposition to customers is elegantly simple. Best network, lowest price," MoffettNathanson senior analyst Craig Moffett said. The company also hiked its full-year operating profit margin guidance. Next catalysts for the company: the upcoming closure of the US Cellular acquisition, a greater pace of stock buybacks thanks to the Trump tax bill, and perhaps more acquisitions. Alphabet You have to be kidding me here. Alphabet (GOOG, GOOGL) is trading at only 19.3 times forward earnings (the S&P 500 is at 24 times), and the stock goes up just 1% on Thursday post-earnings? Did anyone listen to the earnings call? I did: The company said revenue growth accelerated throughout the business. Sales increased 14% year over year in the second quarter, a brisker pace compared to the 12% in the first quarter. Cloud business is rocking (positive read-through to Amazon (AMZN) and Microsoft (MSFT) earnings next week). Alphabet said it's not losing key AI talent to the giant wallet of Meta (META). The discussion around AI and search was very bullish. YouTube is crushing it. "AI (beast) mode it's time to close the valuation gap," KeyBanc analyst Justin Patterson said. Yahoo Finance's Invest Conference Is Coming Up! Join me and the Yahoo Finance newsroom for our annual Invest conference, taking place in New York City, November 12-13. We just added several new speakers to an already awesome lineup. More on the way. Learn more about the conference and register today! Trust, you will want to be in this room ahead of 2026. Brian Sozzi is Yahoo Finance's Executive Editor and a member of Yahoo Finance's editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email Sign in to access your portfolio
Reuters
24-07-2025
- Business
- Reuters
European shares hit 6-week high on US trade deal optimism, earnings boost
July 24 (Reuters) - European shares scaled a six-week high on Thursday, helped by upbeat results from the likes of Deutsche Bank and BNP Paribas, and optimism surrounding the EU-U.S. trade agreement, ahead of a European Central Bank meeting. The pan-European STOXX 600 index (.STOXX), opens new tab gained 0.5% by 0817 GMT after hitting its highest since June 11 in early trading. Most regional bourses were in the green, with Germany's blue-chip DAX (.GDAXI), opens new tab adding 0.9% and the UK's FTSE 100 (.FTSE), opens new tab advancing 0.6% to an all-time peak, on pace for a sixth straight session of gains. In a busy day for corporate results, banks were in a bright spot after second-quarter profit beat from Deutsche Bank ( opens new tab and BNP Paribas ( opens new tab. The German lender Deutsche Bank climbed 5.8%, while French bank BNP Paribas added 2.8%. The eurozone banks index (.SX7E), opens new tab rose to its highest since 2008, aided by a rise in government bond yields. The anticipated trade deal between the U.S. and European Union would impose a broad 15% tariff on imports from the bloc, avoiding a harsher 30% levy planned from August 1, two EU diplomats said on Wednesday. "15% is a good number ... this would imply a meaningless price increase for companies which are exporting to the U.S. This could be totally manageable for the whole supply chain in different industrial sectors and clearly could be potentially also absorbed by the final customers," said Simone Ragazzi, portfolio manager at Algebris Investments. The move would follow Japan's trade deal with the U.S. that lowered auto tariffs and sent automobile shares soaring on Wednesday. Cooling trade tensions have lifted the STOXX 600 about 19% from its lows in April after U.S. President Donald Trump slapped steep tariffs on its trading partners. The index still remains about 2% away from its March historic high. Roche (ROG.S), opens new tab gained 0.8% after the Swiss drugmaker reported better-than-expected first-half operating profit, while Deutsche Telekom rose 3% after its U.S. subsidiary T-Mobile posted strong second-quarter . Both were among the major boosts to the benchmark STOXX 600. Meanwhile, Nestle (NESN.S), opens new tab dropped 3.4% after the Swiss consumer major announced a strategic review of its vitamins business and posted first-half results. Chipmaker STMicro ( opens new tab slumped 10.5% after its first quarterly loss in more than a decade, in contrast to other tech titans Alphabet (GOOGL.O), opens new tab and SK beating earnings expectations. Adding to the upbeat mood, a latest survey showed euro zone business activity accelerated faster than forecast this month, supported by a solid improvement in the bloc's dominant services industry and with manufacturing showing further signs of recovery. Later in the day, focus will shift to the ECB, which is widely expected to keep rates steady at 2% after seven consecutive cuts.
