European Markets Rise Despite Trump's Tariffs; IBEX 35 Falls 0.57% on Inditex's 7% Drop
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European stock markets experienced mixed performances this week, with the Spanish IBEX 35 index notably underperforming due to a significant drop in shares of Inditex. The IBEX 35 opened with gains of 0.56% on Wednesday but ended the day with a decline of 0.57%, closing at 12,804 points. This downturn was largely attributed to Inditex's 7% drop after the company reported a record net profit of 5,866 million euros for the fiscal year 2024-2025, representing a 9% increase from the previous year. Despite this, the market's expectations were not met, leading to a 7.5% stock drop for Inditex and a record dividend payout of 5,236 million euros.
The broader European markets, including the FTSE 100, DAX, and CAC 40, showed resilience amidst ongoing tariff threats from U.S. President Donald Trump. Trump's latest threats to impose 200% tariffs on EU wine and champagne, alongside his earlier 50% tariff threat on Canadian imports, contributed to market volatility. Yet, European indices managed to close in positive territory on Wednesday, with gains ranging from 0.53% in London to 1.56% in Frankfurt. The EU responded with announced retaliatory measures amounting to 26 billion euros, while Canada planned to impose 25% tariffs on US goods starting Thursday.
Asian markets displayed mixed results, with some indices like the CSI 300 in China and the Hang Seng in Hong Kong posting gains of 2.4% and 2.22% respectively, despite Wall Street's decline. The escalation in the trade war, with Trump's tariff threats and the EU's announced retaliatory measures, continued to influence global market sentiment. Wall Street ended the week with losses exceeding 4%, with the Dow Jones experiencing its worst weekly drop since June 2022, and the S&P 500 and Nasdaq marking their fourth consecutive negative week. Notable performers in Asia included WuXi Biologics, up 13%, Meituan with a 6% increase, Ping An Insurance gaining 6%, and BYD advancing 5.8%.
On Friday, European markets were poised to open higher, with the FTSE 100 expected to gain 28 points to 8,567, the DAX projected to add 107 points to 22,639, and the CAC 40 anticipated to rise 26 points to 7,970. Investors remained focused on corporate earnings, with companies like BMW, Daimler, and Swiss Life set to report, alongside key economic data releases such as the UK's January GDP figures and inflation data from Germany, France, and Spain. Amidst these developments, Ukraine's 30-day ceasefire proposal was accepted by Russia, and the US consumer confidence data was awaited. Upcoming interest rate meetings of the Federal Reserve, the Bank of England, and the Bank of Japan were also on investors' radar. In the commodities market, Brent oil was priced at $70.330 per barrel, and gold was nearing $3,000 per ounce.
