European stocks regained stability on Thursday, as the STOXX 600 index rose by 0.1%, recovering from early declines. Mining stocks led the charge, with a 1.8% increase in the sector, buoyed by major players such as Rio Tinto, Anglo-American, and Antofagasta. This helped offset the negative performance in retail, where companies like B&M, Marks & Spencer, Tesco, and Greggs faced significant losses due to disappointing Christmas sales updates. Despite the overall positive movement, concerns about rising inflation, the Federal Reserve’s stance on interest rates, and U.S. tariff policies under President-elect Donald Trump kept bond markets under pressure.
The market’s uncertainty was exacerbated by reports that Trump may declare a national economic emergency, which could pave the way for broad tariffs. Investors are closely watching the inauguration for clues on the direction of his economic and foreign policies, with hopes that his threats are more of a negotiating tactic rather than a prelude to a full-scale trade war. In the bond markets, yields surged globally, with the UK’s 10-year yield hitting its highest level since 2008, as concerns over increased debt sales and rising interest rates continued to weigh on sentiment.
Despite broader market jitters, some companies bucked the trend. Swiss life sciences equipment maker Tecan Group saw a 6.8% rise in its stock after exceeding sales expectations for 2024. Meanwhile, the oil and gas sector also showed a slight uptick, providing additional support to the market. Trading volumes were lower than usual, as U.S. markets were closed for a national day of mourning following the death of former President Jimmy Carter.