European Midday Briefing : Stocks Edge Higher ; Lagarde Says Trade Remains Challenging

marketscreener.com · Feb 26, 2026 · Collected from GDELT

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MARKET WRAPS European stocks initially struggled for direction after Wednesday's higher session, with the Stoxx 600 index shifting between incremental gains and losses, as investors assessed changing trade winds and considered the latest marker laid down by tech stocks. Europe's leading indexes were mixed at the opening bell. The FTSE 100 was largely flat despite gains from Rolls Royce and the London Stock Exchange Group . The DAX slipped, dragged by healthcare stocks while the CAC 40 rose, bucking the continental trend. Approaching midday, industrials lifted both the FTSE 100 and the DAX into positive territory while the CAC 40 was supported by utilities . The Stoxx 600 index was higher. The moves come as European Central Bank President Christine Lagarde, in a speech to lawmakers in the European Parliament, said Eurozone exporters continued to have greater difficulty finding overseas buyers. "The trade environment remains challenging owing to higher tariffs, a stronger euro and a persistently volatile global policy environment," she said. Expected later are the results from the eurozone's business and consumer surveys for February and money supply data for the month of January. Thursday will also see Italy's end-of-month bond auction and business and consumer confidence surveys. Meanwhile, U.S. and Iranian negotiators were set to meet Thursday for talks which could determine whether President Trump orders military action over its nuclear program. "A constructive resolution would likely prompt the market to gradually unwind as much as a $10/bbl risk premium, which we believe is currently priced in. If talks break down, the upside risk remains, but the market may hold off on a full reaction until the scale of potential U.S. action against Iran becomes clearer," ING said . Elsewhere, the special election in Gorton and Denton in the U.K. will give an indication of the ruling Labour Party's popularity. Investors are concerned that if Starmer and Treasury chief Rachel Reeves were forced out, their replacements could favor increased fiscal spending and trigger fresh debt sustainability fears. Market Insight Shortages of memory chips in the tech supply chain could worsen in the next three years, Macquarie said. Memory demand for AI will only rise and high bandwidth memory prices could rise sharply given expectations of limited supply for the next few years. U.S. Markets: Stock futures pointed to a mostly lower open Thursday. On a day otherwise light in U.S. data, weekly jobless claims data are due at 1330 GMT. Forex: The dollar edged lower, dented by tariff uncertainty and concerns about the Federal Reserve's independence. Sterling fell as voters head to the polls for a one-off U.K. local district election that could determine Prime Minister Keir Starmer's future. Bitcoin fell after Nvidia reported strong earnings but failed to impress. Jefferies said concerns about returns on capital expenditure on artificial intelligence as well as the technology's potential disruption to industries continue to weigh. "We believe that the linkage between crypto and tech stocks will persist over the coming months." Bonds: Treasury yields declined in Asian trade, reversing the previous day's rise, with the day's focus on talks between the U.S. and Iran in Geneva. Treasury yields haven't reacted to hawkish remarks from a Bank of Japan policy board member saying a rate hike was needed soon. Eurozone government bond yields were little changed in early trade, tracking a similar trend in Treasurys as investors await fresh drivers to trade on. Natixis recommends investors to buy dips in two-year Treasury notes to around 3.65%. Given current carry profile and limited yield downside in Natixis's forecast, it says it has a high bar for tactical longs and will be selective for entry level. Italy's end-of-month auction will round off government bond sales in the eurozone for February. Yields on U.K. government bonds were steady as investors wait for the outcome of Thursday's special election in Gorton and Denton. Gilts could rally as public-debt issuance is projected to fall in the fiscal year to April 2027, according to RBC Capital Markets. Bond markets are looking for a new driver to take them out of the current ranges, according to Commerzbank, adding that bond markets were stuck . Intra-day volatility remains low pointing to 10-year Bund yields which hovered in a one-basis-point range on Wednesday. Meanwhile, tighter eurozone government bond yield spreads are reflecting recovering risk sentiment and underscoring the positive carry environment. Energy: Oil prices edged higher ahead of a third round of nuclear talks between the U.S. and Iran later. Meanwhile, the latest EIA data showed U.S. crude oil inventories increased by 16 million barrels last week, the largest weekly build since February 2023. Price differences between near-term and later Brent crude contracts have weakened recently, suggesting the physical market is becoming increasingly well supplied. Natural Gas European natural-gas prices were hovering around 30 euros a megawatt-hour, supported by forecasts for milder weather and ample LNG supply. Metals: Gold prices slipped in early trading but remained above $5,100 a troy ounce as investors looked ahead to U.S.-Iran talks later on Thursday. New York futures fell amid concerns that U.S. interest rates could remain on hold for some time. "Any escalation in tensions involving Iran is likely to add further support and reinforce gold's role as a hedge against shocks," ING said, adding that the structural drivers behind gold's earlier rally remained in place. EMEA HEADLINES Allianz Posts Rise in Operating Profit, Issues In-Line Guidance Allianz delivered a record operating profit for 2025 and issued guidance for the year ahead as it reported growth across its key metrics for the last year's final quarter. Europe's largest insurer by market capitalization on Thursday guided for a 2026 operating profit-a metric that reflects its core operations and strips out exceptional and other one-off items-of 17.4 billion euros ($20.55 billion), with a one-billion-euro margin of error, in line with the 17.37 billion-euro result it posted for 2025. French Insurer AXA Reports Profit Rise After Asset Manager Sale AXA reported a jump in net profit for 2025 after disposing of its asset management unit as part of a plan to refocus on core insurance operations. The French insurer on Thursday posted 9.80 billion euros ($11.53 billion) in net profit for the year ended Dec. 31. This was 24% ahead of 2024's result on a reported basis due to top-line growth as well as the one-off impact from the sale of AXA Investment Managers to BNP Paribas, which closed in July. Analysts had expected it to report 9.74 billion euros, according to a company-compiled consensus. Decline in War-Risk Premium Is Boost for Central and Eastern Europe, EBRD Says The risk premium demanded by investors to lend to countries in central and eastern Europe has fallen back to levels last seen before Russia's full scale invasion of Ukraine, easing the war's negative impact on the region's economies, the European Bank for Reconstruction and Development said Thursday. That is one development among many that has left the bank "slightly optimistic" about the year ahead in the countries in which it invests, according to Chief Economist Beata Javorcik. GLOBAL NEWS Trump digs in his heels on tariffs - with major implications for the U.S. dollar Market strategists weighed in on President Donald Trump's State of the Union address late Tuesday and came away with some important implications for the U.S. dollar. In a nutshell, Trump gave no sign that he might relent on his current tariff agenda. The president's new temporary global tariffs of 10% - which came in reaction to the Supreme Court's decision last Friday to strike down Trump's previous tariffs - went into effect earlier on Tuesday, ahead of the State of the Union address. Trump has threatened to push these new tariffs up to 15%. White House Says Iran Is Close to Weapons-Grade Nuclear Material. Experts Say No. Iran's atomic program hasn't advanced significantly since the U.S. and Israel struck its three main nuclear sites last June, according to experts and diplomats, despite Washington's top negotiator saying Tehran could make fissile material for a bomb within days. The appraisal, which is widely accepted by officials and researchers who study Iran's nuclear activities, comes as U.S. and Iranian officials prepare to hold talks on Thursday that could determine whether President Trump orders military action against the country. Fed's Bostic Says People Have Begun to Doubt Fed Independence Atlanta Fed President Raphael Bostic said Wednesday that the rift between the Federal Reserve and the White House has begun to erode trust in the central bank's apolitical standing, one of the most direct warnings yet from a top monetary-policy official about the consequences of President Trump's aggressive stance toward the Fed. Writing in a farewell essay ahead of his scheduled retirement from the Atlanta Fed at the end of February, Bostic said his colleagues in the Federal Reserve system remain committed to insulating their work from politics. U.S. Should Shift Gears on Economic Policy, International Monetary Fund Says An alternative policy mix in the U.S. could achieve the Trump administration's goals while avoiding negative repercussions, the International Monetary Fund says. In a review of the U.S. economy, the IMF focused on the macroeconomic effect of policy shifts introduced in 2025 and their effects on the U.S., its trading partners and the global economy. Epstein Used His Fortune to Infiltrate America's Most Prestigious Universities (MORE TO FOLLOW) Dow Jones Newswires 02-26-26 0516ET