Key facts
- European shares closed little changed on Thursday, August 13.
- Investors awaited euro zone employment and inflation data.
- Companies are experiencing a strong earnings season, with energy and materials sectors benefiting from high commodity prices.
- Middle East conflict uncertainty and weaker commodity prices weighed on sentiment.
- Brent crude futures fell 0.7%, and energy and basic resources sectors saw declines.
- Maersk and Adyen shares rose on positive company-specific news.
European shares closed largely unchanged on Thursday, August 13, as investors awaited key economic data from the euro zone, including employment and inflation figures. The pan-European STOXX 600 index finished near flat at 659.24 points, retreating from record highs reached in the previous session.
Companies across the region are experiencing one of the strongest earnings seasons in years. Profits in the energy and materials sectors have been significantly boosted by elevated commodity prices, partly driven by the ongoing Middle East conflict. Joost Van Leenders, senior investment strategist at Van Lanschot Kempen Investment Management, noted a substantial improvement in the earnings picture compared to previous years, which is a strong driver for European equities.
However, investor sentiment remained subdued due to uncertainties surrounding the Middle East conflict, particularly concerning the strategic Strait of Hormuz, a vital waterway for global energy supplies. David Morrison, senior market analyst at Trade Nation, highlighted the difficulty in pricing the Middle East situation, as markets have repeatedly anticipated an imminent end to the conflict.
Weaker commodity prices also weighed on the market. Brent crude futures fell 0.7% on Thursday, pressured by expectations of weaker global demand and an increase in U.S. crude inventories. Consequently, the energy sector declined by 0.8%, and basic resources shares led sectoral losses with a 3% drop, their steepest fall in over a month, as precious metal and copper prices weakened.
Limiting the overall losses on the STOXX 600, the food and beverages sector gained 1.3%, and telecom shares rose 1%. Among individual stock movers, Maersk surged 9.4% after the Danish shipping group exceeded profit forecasts and raised its full-year earnings guidance for the second time this year, driven by higher freight rates. Adyen, the Dutch payments firm, jumped 16.4% after lifting its annual revenue growth forecast. Conversely, Swissquote tumbled 14%, hitting its lowest in over a year, after missing first-half expectations due to weak cryptocurrency income.