European stock markets showed mixed performance on Tuesday, pressured by a sharp decline in Germany’s ZEW economic sentiment index. Frankfurt’s DAX led losses (-0.5%), while Milan’s FTSE MIB (+0.4%), Paris’s CAC 40 (+0.1%), and London’s FTSE 100 (+0.05%) posted gains. Madrid’s IBEX 35 closed flat.
US futures traded lower despite business confidence rising over 100 points, as investors awaited July inflation data. The yield spread between Italian BTPs and German Bunds widened above 79 basis points, with the annual Italian yield rising 1.8 basis points to 3.5% and the German yield up 1.5 basis points to 2.71%.
Gold steadied near $3,344 per ounce after avoiding potential US tariffs on 1kg bars. Crude oil showed weakness (WTI -0.1% at $63.89/barrel), while natural gas declined (-0.88% to €32.71/MWh).
Technology stocks faced pressure, led by software firms Nemetschek (-7.74%), Sage Group (-4.21%), and SAP (-4%). Semiconductor producers were mixed: Infineon (+0.64%), STMicroelectronics (+0.3%), ASML (-0.6%), and BE Semiconductor (-0.55%).
Defense stocks saw continued buying with Leonardo (+1.44%) and Kongsberg (+1.43%), while Rheinmetall’s gains slowed (+0.5%). Automakers were divided: Stellantis rose (+1.15%) as Ferrari dipped (-0.58%). Oil majors Shell (+0.8%), TotalEnergies (+0.75%), and Eni (+0.6%) advanced, contrasting with BP’s decline (-0.1%).
In banking, Banco Sabadell surged (+1.15%) after BBVA (-1.71%) confirmed its takeover bid despite Sabadell selling UK unit TSB. Popolare di Sondrio (+0.75%), Intesa Sanpaolo (+0.45%), and UniCredit (+0.4%) gained. BPER resisted (+0.23%), Commerzbank was flat, while Monte dei Paschi (-1%), Mediobanca (-0.57%), and Banco BPM (-0.3%) weakened.