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European markets fell slightly on Thursday, after an initially positive start to 2025 trading.
The pan-European Stoxx 600 The index reversed earlier gains to trade down 0.3% at 11:18 a.m. London time as regional bourses reopened after the New Year’s Day holiday.
Bank stocks led the losses, losing more than 2%, while automakers also fell 1.8%. Meanwhile, oil and gas stocks rose, adding 1%, while utilities also rose 0.84%.
Spain’s actions BBVA and Santander Bank were among the biggest losers in the selloff in bank stocks, falling more than 4%. Italy Unicredit traded around 3% less.
The main regional stock exchanges also registered red numbers at mid-morning, with the French CAC 40 losing 1.2%. President Emmanuel Macron seemed to admit on Tuesday that his decision to hold early parliamentary elections last year caused problems for the country.
“We are also facing political instability, it is not specific to France, we also see it among our German friends who have just dissolved their Assembly. But we are legitimately concerned,” Macron said in his New Year’s speech. “I must admit tonight that the dissolution (of Parliament) has brought, for the moment, more divisions to the Assembly than solutions for the French,” he added.
Elsewhere, Germany DAX fell 0.3% on Thursday and the UK FTSE 100 I was hovering around the flat line.
It comes as manufacturing activity retreated in December in Germany and France, in a sign that problems continue for the euro zone’s two largest economies. The HCOB manufacturing purchasing managers’ index hit 42.5 last month in Germany, up from 43.0 in November. Meanwhile, in France, production volumes fell to 41.9, the steepest drop since May 2020.
Manufacturing activity also slowed in Italy in December, data showed, while Spain recorded another month of expansion as southern Europe’s economy continues to gain strength.
In currency markets, both sterling and the euro plunged against a strengthening dollar. Sterling hit its lowest level against the dollar since April 2024, and was last down 0.61% at $1.2441 at 11:43 a.m. London time. The euro fell 0.31% to $1.0323, its lowest level since November 2022.
Pound sterling
UK house prices rose 0.7% month-on-month in December as activity remained unusually strong in the final month of the year, data from British lender Nationwide showed on Thursday. House prices rose 4.7% over the year, putting them within striking distance of the all-time highs recorded in the summer of 2022.
Asian stocks Stocks traded mixed overnight, with China stocks leading losses as several major markets resumed trading after the New Year holidays.
US stock futures They were slightly higher when trading began for 2025. Traders hope that the market can regain the momentum that propelled it to post two consecutive years of annual gains of more than 20%.
— CNBC’s Christina Cheddar Berk and Sophie Kiderlin contributed to this market report
