This is CNBC’s live blog covering European markets.
European markets gyrated Wednesday afternoon, as global markets assessed a hotter-than-expected inflation reading in the U.S.
The pan-European Stoxx 600 index was 0.15% higher at 4 p.m. in London, after dipping into the red shortly following the print release earlier in the afternoon. The U.S. dollar also gave up some of its gains, trading slightly lower against the euro.
The U.S. consumer price index gained 0.5% in January, taking the annual inflation rate to 3%, above the Dow Jones estimate of 2.9%. The core CPI, excluding food and energy prices, was also higher than forecast.
U.S. stocks opened lower following the inflation print.
Top posts
- Heineken posts forecast-beating full-year profits, launches buyback | view post
- ECB’s Holzmann says inflation risks have increased and central bank must be ‘patient’ | view post
- Kering shares up by 5% as UBS raises target price | view post
- U.S. consumer prices rise more than expected in January | view post
Heineken shares jumped 14% after the Dutch brewer posted a forecast-beating a rise in operating profits and launched a 1.5 billion euro ($1.55 billion) share buyback program.
The positive results led other drinks makers higher, with Belgium’s AB InBev adding 4% and Denmark’s Carlsberg gaining 3%.
Traders were on guard Tuesday after Federal Reserve Chair Jerome Powell told the Senate Banking Committee that policymakers were in no hurry to make more interest rate cuts. Powell will appear before the House Committee on Financial Services on Wednesday.
Elsewhere, Asia-Pacific markets mostly rose overnight.
— CNBC’s Brian Evans contributed to this market summary
Powell indicates that Trump call for lower rates won’t influence policy
Fed Chair Jerome Powell said Wednesday that interest rate decisions won’t be based on political pressure, even if that’s coming from President Donald Trump.
Asked about comments Wednesday morning from the president in which he called for lower rates, Powell said, “It’s a practice to never comment on anything the president says, but I think people can be confident that we’ll continue to keep our heads down, do our work, make our decisions based on what’s happening in the economy.”
The response came during questioning in front of the House Financial Services Committee, where Powell was appearing as part of his semiannual testimony on monetary policy. Asked whether statements from elected officials “are not among the things that cause you to act one way or the other,” the chair responded, “That’s correct.”
—Jeff Cox
Euro and sterling fall against the dollar as U.S. inflation comes in above target
The British pound and euro fell against the U.S. dollar after the U.S. consumer inflation report came in above forecasts, as investors assessed whether the Federal Reserve will be deterred from interest rate cuts this year.
The euro was last lower by 0.22% at $1.0341 while sterling was down 0.43% to $1.2390.
Markets expect the Federal Reserve to stay on hold for a while, with pricing following the inflation report suggesting a rate cut may not come until September, according to CME Group data.
“This [CPI] report is not quite as scary as it seems,” Kyle Chapman, FX markets analyst at Ballinger Group, said in emailed comments.
“The upward pressure is coming primarily from the fading deflation in core goods and an uptick in energy prices. In the services sector, which better reflects the underlying momentum, we continue to see steady progress, particularly in the shelter component.”
Chapman added: “So, the uptick does not derail the longer-term downward trend in inflation. Nor does it suggest that rates are no longer headed downwards, or that a hike might be the sensible next move. But it does reaffirm the consensus that cuts are going to come much more slowly than we had thought towards the end of last year.”
— Sawdah Bhaimiya
U.S. stocks open lower on Wednesday
The Dow Jones Industrial Average dropped 426 points, or 0.9%, shortly after 9:30 a.m. ET. The S&P 500 and the Nasdaq Composite each lost about 1%.
— Pia Singh
U.S. consumer prices rise more than expected in January
The latest U.S. consumer inflation report came in hotter than expected, raising questions over how much the Federal Reserve will be able to lower rates going forward.
The consumer price index rose 0.5% in January month over month, while rising 3% year on year. Economists polled by Dow Jones expected CPI to increase 0.3% month over month and 2.9% year over year.
Core CPI, which strips out volatile food and energy price, advanced 0.4%, also more than expected.
— Fred Imbert
Barratt Redrow up 4% on share buyback, improved guidance
Shares of Barratt Redrow rose 4% after the British homebuilder said it would initiate a £100 million ($124.5 million) annual share buyback, starting with a £50 million buyback in the second half of the financial year.
The company said business growth had generated significant medium-term free cash flow, as it reported half-year results showing 23.2% increase in year-on-year revenue and a 6.4% rise in adjusted pre-tax profit.
It also said it expected full-year adjusted profit before tax to come in toward the “upper end of market expectations” amid a recovery in customer demand.
Investec analyst Aynsley Lammin said the results contained “very encouraging” medium-term guidance and showed the integration of companies Barratt and Redrow, which completed in mid-2024, was progressing well.
The new group said it was on-track for cost synergies of at least £100 million.
— Jenni Reid
Underlying economic issues in Europe are significant, says Deutsche Börse CEO
Stephan Leithner, CEO of Deutsche Börse, discusses the firm’s fourth-quarter earnings, international investment in Germany and the global economy.
Kering shares up by 5% as UBS raises target price
French luxury goods firm Kering was up by over 5% by mid-morning, as UBS raised its target price on the stock after the company on Tuesday reported better-than-expected fourth-quarter sales.
UBS analyst Zuzanna Pusz raised Kering’s target price from 228 euros ($236.6) to 246 euros, citing better overall sector trends and strict cost controls. Kering’s 2024 full-year results “were better than feared,” Pusz said, but added UBS was taking a “more cautious” view on 2025 profitability of the firm’s Gucci brand.
The high-end fashion group, whose brands include Gucci, Bottega Veneta and Balenciaga, posted a 12% decline in fourth-quarter revenue to 4.39 billion euros, up from the 4.29 billion euros predicted by LSEG analysts.
Gucci sales, which make up almost half of the group’s total revenues, dropped 24% annually to 1.92 billion euros, showing a lagging demand for the group’s once-favored luxury label.
— Sawdah Bhaimiya
Dutch brewer Heineken sees minimal impact from U.S. aluminum tariffs
U.S. President Donald Trump’s aluminum tariffs are unlikely to have a significant impact on production costs at Heineken, the Dutch brewer CNBC Wednesday.
CEO Dolf van den Brink said the tariffs, which take effect from March 4, could have an impact on aluminum pricing for its beer cans, but noted that for 2025, at least, the company was well covered.
Van den Brink added that the beer industry in general, given its local supply chains, was typically “less susceptible to disruption in international trade flows” and assessed the risk as manageable.
That comes after spirits maker Diageo, which relies on Canadian and Mexican production for much of its U.S. sales, last week removed its medium-term guidance on U.S. tariff uncertainty.
“Given our footprint and our local-for-local structure, for us the impact at this moment is assessed to be relatively manageable,” he told “Squawk Box Europe.“
Heineken on Wednesday posted a forecast-beating a rise in operating profits and launched a 1.5 billion euro ($1.55 billion) share buyback program. Shares were last up 11.4%.
— Karen Gilchrist
Banco BPM sweetens Anima bid, sets out targets
Italy’s third-largest lender Banco BPM has sweetened its bid for asset manager Anima Holding, part of an attempted transaction that has been complicated by UniCredit‘s own takeover attempt of its domestic peer.
Banco BPM on Wednesday called a shareholder vote on Feb. 28 to lift its offer for Anima to 7 euros ($7.26) per share from its initial bid of 6.20 euros per share in November – aligning with the company’s market close price of 6.98 euros per share on Feb. 11.
The lender also reported an annual net income jump of 18% to 1.69 billion euros across full-year 2024, with return on tangible equity — a measure of profitability — of 16% last year, compared with 14.1% in 2023.
Banco BPM plans shareholder returns of more than 7 billion euros as part of its 2024-2027 plan and targets a net income of 2.15 billion euros by the end of that period.
The lender’s Milan-traded shares were up 0.87% at 09:58 a.m. London time.
— Ruxandra Iordache
ECB’s Holzmann says inflation risks have increased and central bank must be ‘patient’
European Central Bank voting member Robert Holzmann told CNBC Wednesday that the global tariffs being threatened and enacted by U.S. President Donald Trump had increased inflationary risks in the euro zone.
Concerns that have previously led the Austrian central bank governor to skew more hawkish “have not dissipated. On the contrary, with the arrival of this threat of tariffs, they re-emerged,” Holzmann told CNBC’s “Squawk Box Europe.“
“Before they were somewhat dissipated, because we looked like [we were] moving slowly towards lower rates. What we have now is the threat of higher inflation rates. And for this reason, we have to be careful.”
He added: “My take is that [disinflation] won’t speed up … because the models I know and we use, what they [show] is that an increase in trade frictions reduces growth, that’s true, but at the other end, it also increases inflation, so we will have to be more patient.”
Regarding the possibility of a larger 50 basis point rate cut as the euro area grapples with tepid economic growth, Holzmann said: “I think this would not be a good decision, because our job is to deal with inflation, not with growth. And the result of it, using the interest rate in order to initiate a higher growth is not the way how we should work.”
The ECB cut interest rates by a quarter-percentage-point in January and said the disinflation process was “well on track.”
— Jenni Reid
European stocks open higher
European markets opened higher Wednesday as global markets await the latest inflation reading out of the U.S.
The pan-European Stoxx 600 was up 0.14% in opening trade, with all major bourses and almost all sectors in the green. Food and beverage stocks led gains, up 1.06%, while oil and gas stocks fell 0.62%.
— Karen Gilchrist
Siemens Energy sees rising energy demand after strong first quarter
Siemens Energy site in Muelheim an der Ruhr, Germany, August 3, 2022.
Siemens Energy pointed to strong energy demand as a key growth driver in 2025 after posting solid first-quarter results Wednesday.
Revenues rose 18% in the first quarter to 8.9 billion euros ($9.2 billion) while profit before special items doubled to 481 million euros, which the company said “clearly exceeded” the prior year.
“Our strong first quarter reflects the market opportunities arising from the increasing demand for electricity,” president and CEO of Siemens Energy AG, Christian Bruch, said in a statement.
— Karen Gilchrist
Heineken posts forecast-beating full-year profits, launches buyback
Heineken said it has seen signs of slowdown in demand for its beer in some European markets after its third-quarter sales rose by less than expected.
Dutch brewer Heineken on Wednesday posted a rise in operating profits that beat a forecast compiled by the company and said it would launch a 1.5 billion euro ($1.55 billion) share buyback program.
The business reported an 8.3% rise in full-year organic operating profit before exceptional items and amortization to 4.51 billion euros, ahead of analysts’ forecast of 5.3%.
The company, whose brands include Amstel, Cruzcampo and Kingfisher, said operating profit would rise between 4% to 8% in 2025.
— Karen Gilchrist
European markets: Here are the opening calls
European markets are expected to open in higher territory Wednesday.
The U.K.’s FTSE 100 index is expected to open 4 points higher at 8,785, Germany’s DAX up 75 points at 22,104, France’s CAC up 12 points at 8,042 and Italy’s FTSE MIB 102 points higher at 37,798, according to data from IG.
Earnings come from Randstad, Heineken, EssilorLuxottica, Michelin, Deutsche Boerse and Siemens Energy on Wednesday.
— Holly Ellyatt
