European stocks edged higher Wednesday, with investors digesting more solid quarterly corporate earnings as well as cooling U.K. inflation data.
At 03:15 ET (08:15 GMT), the DAX index in Germany gained 0.7%, the CAC 40 in France advanced 0.5% and the FTSE 100 in the U.K. rose 0.5%.
Subscribe to InvestingPro for more stock market analysis Quarterly corporate results in spotlight European equities received a boost from small gains on Wall Street overnight, even as concerns lingered about valuations linked to artificial intelligence and AI’s potential impact on the broader economy.
Still, the quarterly earnings season remains a key focus for investors, and results have been generally positive with around 60% of European companies having beaten earnings expectations so far, compared to a typical quarter when 54% would beat analyst estimates, according to data from LSEG.
On an individual level, miner Glencore reported lower full-year earnings as record-high copper prices were not enough to offset a decline in profits from its coal business.
British defense company BAE Systems raised shareholder payouts after defense orders climbed to a record level, as higher military spending across Europe and the United States supported revenue growth and cash generation.
Straumann Group beat fourth-quarter sales expectations and delivered margins in line with its guidance, but the dental implants company said growth in China remained under pressure, while currency effects are expected to weigh on reported earnings in 2026.
Castellum reported a fourth-quarter net loss amid negative property revaluations, while income from the Nordic real estate company’s property management continued to grow.
U.K. inflation cools sharply The U.K. inflation rate in January fell to its lowest level since March last year, lifting the likelihood of an interest rate cut by the Bank of England next month.
Consumer prices rose by 3.0% in annual terms last month, slowing from a 3.4% increase in December, the Office for National Statistics said.
Although the headline figure remains above the BoE’s 2% target, the central bank expects the pace of price rises to slow sharply to close to this target in April as last year’s rises in utility costs and other government-controlled tariffs fall out of the annual comparison.
Investors mostly expect the central bank to cut its benchmark interest rate to 3.5% in March after a tight vote to keep borrowing costs on hold in February.
Inflation also cooled in France, as consumer prices rose 0.4% year-on-year in January, dropping from 0.7% in December.
Crude edges higher Oil prices edged higher Wednesday, bouncing after falling sharply in the previous session, as signs of progress in U.S.-Iran nuclear negotiations eased fears of supply disruptions.
Brent futures gained 0.5% to $67.74 a barrel, and U.S. West Texas Intermediate crude futures rose 0.5% to $62.54 a barrel.
Brent contract slipped nearly 2% on Tuesday, while WTI prices fell 1%.
