European shares rose slightly on Wednesday, as investors digested more strong quarterly corporate earnings and a decline in UK inflation.
The pan-European STOXX index rose 0.4% to 624.15 points, Germany’s DAX index climbed 0.7%, France’s CAC 40 index advanced 0.5%, and the UK’s FTSE 100 index gained 0.5%.
European stocks received a boost from modest gains on Wall Street, despite continued concerns about AI-related valuations and their potential impact on the wider economy.
However, the quarterly earnings season remains a major focus for investors, and results have been generally positive, with around 60% of European companies exceeding earnings expectations so far, compared to a typical quarter where 54% exceed analysts' estimates, according to data from the London Stock Exchange Group.
Mining company Glencore announced a decline in its annual profits, as record high copper prices were not enough to offset falling earnings from its coal business.
British defense company BAE Systems raised shareholder payouts after defense orders surged to a record high, with increased military spending across Europe and the United States supporting revenue growth and cash generation.
The Straumann Group beat fourth-quarter sales expectations and achieved profit margins in line with its forecasts, but said growth in China remained under pressure, while currency effects were expected to negatively impact reported earnings in 2026.
Castelum announced a net loss in the fourth quarter amid a negative real estate revaluation, while income from property management continued to grow.
The UK inflation rate fell in January to its lowest level since March of last year, raising the likelihood that the Bank of England will cut interest rates next month.
The Office for National Statistics said consumer prices rose 3.0% year-on-year last month, slowing from a 3.4% increase in December.
Inflation also eased in France, with consumer prices rising 0.4% year-on-year in January, down from 0.7% in December.
