European stock markets saw mostly positive gains on Thursday, buoyed by optimism surrounding potential peace talks between Ukraine and Russia. Investors were also digesting UK economic growth data and corporate earnings reports.
By 03:05 ET (08:05 GMT), Germany’s DAX rose 1.2%, and France’s CAC 40 gained 1%. However, the UK’s FTSE 100 saw a decline of 0.4%, in part due to ongoing economic concerns.
Ukraine Peace Talks Spark Market Optimism
Sentiment was lifted by hopes that the war in Ukraine could be nearing an end. U.S. President Donald Trump confirmed phone calls with both Russian President Vladimir Putin and Ukrainian President Volodymyr Zelensky on Wednesday, during which both leaders expressed interest in ending the prolonged conflict.
Trump also announced that he had instructed top U.S. officials to initiate peace talks, a significant step toward potential resolution. This announcement followed comments from U.S. Defense Secretary Pete Hegseth, who stated that Ukraine would abandon its bid to join NATO—one of the key points of contention for Moscow.
UK Economy Surprises with Growth in Q4
In the UK, economic data showed an unexpected growth in the final quarter of 2024. The country’s GDP grew by 0.1%, contrary to earlier forecasts that predicted a 0.1% contraction. December saw a stronger-than-expected 0.4% growth, led by robust performance in the services sector.
Meanwhile, German inflation held steady at 2.8% in January, in line with expectations, based on preliminary data released by the Federal Statistics Office.
Corporate Earnings in Focus
Several major companies released quarterly earnings on Thursday, offering a mixed picture of corporate health.
Barclays reported a 24% rise in annual pretax profit, surpassing forecasts. The bank’s investment division showed strong performance in 2024, and slower-than-anticipated interest rate cuts helped sustain domestic lending income.
Commerzbank also reported solid results, with revenues up 6.2% year-on-year, largely driven by strong activity in securities trading and capital markets.
Unilever saw underlying sales growth of 4%, slightly missing expectations. The consumer goods company also announced the planned demerger of its ice cream business, which will be listed in Amsterdam, London, and New York.
Nestlé reported a sharp slowdown in organic growth, with a 2.2% rise in 2024, down significantly from the 7.2% seen in 2023. The company cited macroeconomic challenges and shifting consumer demand as contributing factors.
Thyssenkrupp raised its outlook for free cash flow, supported by advance payments for a major submarine order from the German military.
Crude Prices Drop on Peace Deal Hopes
Oil prices fell on Thursday as market expectations rose that a potential peace agreement between Ukraine and Russia could lead to the lifting of sanctions that have disrupted global oil supply.
As of 03:05 ET, U.S. crude futures (WTI) dropped 1% to $70.66 a barrel, while Brent crude fell 1% to $74.47 a barrel. Both benchmarks had dropped over 2% on Wednesday following the announcement of peace discussions between the two nations.
The decline in oil prices comes as Russia, the world’s third-largest oil producer, has faced severe sanctions that have supported higher oil prices since its invasion of Ukraine nearly three years ago. The prospect of a peace deal is fueling hopes of a reduction in these sanctions, which could ease global supply constraints.
Related topics: