European stocks posted a small increase on Wednesday as investors understood more quarterly corporate earnings before the release of expected regional inflation data.
At 03:02 ET (08:02 GMT), the DAX index in Germany increased by 0.2%, the FTSE 100 in the UK climbed 0.3%, and the CAC 40 in France rose by 0.4%.
The harsh sell-off in precious metals, which initiated during the previous week, has now settled down to a larger extent and is now enabling investors to focus again on the ongoing quarterly earnings season. Since most of the senior European companies are expected to report this week.
UBS (SIX: UBSG) posted a forecast-excelling 56% increase in net profit due to outstanding performance in investment banking and wealth management divisions.
The World’s largest wealth manager, the Swiss Bank, has also declared to repurchase shares of at least $3 billion in 2026. This amount is quite similar to the amount it bought during the previous year, and it aims to do even more.
Novartis (SIX: NOVN) estimates a decrease in 2026 operating profit in the low single-digit percentage range. Since the Swiss drug manufacturer’s results were affected by competitors generating cheaper copies of established products like Entresto, a heart drug.
GSK (LON: GSK) predicts slower growth in sales in 2026 during the first outlook, as it is shifting its focus on expanding its pipeline to address looming patient expiries for its top-selling HIV medicines.
French Bank Credit Agricole (EPA: CAGR) reported that its fourth quarter net income dropped by 24%. Despite the strong earnings and a higher dividend plan, the net income dropped due to a big charge associated with its Banco BPM investment.
On the other hand, Banco Santander (BME: SAN) reported a 12% increase in profits for 2025. It is the fourth consecutive year of its record results, as the bank took advantage of record fee generation and resilient interest income
Moreover, the investors are also paying attention to the financial performance of Alphabet, the parent company of Google. The company is expected to release its report after the closing of the stock market. It is expected that the company will report an increase of 15% in revenue to $111.37 billion.
The primary focus of the investors would be the company’s spending plan for 2026, its update on AI capacity and constraints, and its cloud outlook.
Apart from the corporate sector, the Eurozone’s initial inflation data for January is due later Wednesday, before the European Central Bank’s rate decision. It is expected that inflation in the euro area has slowed slightly, i.e., 1.7% during the previous month. This is below the target of 2% defined by the European Central Bank, indicating that prices are not increasing rapidly.
It is anticipated that the ECB will leave the interest rates unchanged at 2%. However, if the inflation is too low than expectations, then it would raise concerns among policy makers. The strengthening of the euro against the US dollar can further push prices down even more and make inflation weaker.
Read: Gold Prices Soar Again to $5,000/Oz As Iran Worries Grow
On the other hand, oil prices also increased on Wednesday due to rising tension between Washington and Tehran, leading to a disruption in supplies of crude oil from crude-rich regions. Brent oil futures for April increase to $67.40 per barrel, and West Texas Intermediate crude futures jump to $63.38 per barrel. Thus, both benchmarks increase nearly by 3% on Tuesday.
According to the reports revealed by Investing.com US has shot down an Iranian drone moving towards a US aircraft carrier in the Arabian Sea, while a group of Iranian gunboats was also seen approaching a US tanker in the Strait of Hormuz. These incidents took place just before the scheduled talks between Washington and Tehran, generating doubts about these negotiations
