European stocks fell on Thursday, as investors digested a flood of quarterly corporate earnings amid heightened geopolitical tensions.
At 11:02 (Saudi Arabia time), Germany's DAX index fell by 0.3%, France's CAC 40 index declined by 0.2%, and the UK's FTSE 100 index dropped by 0.2%.
Corporate financial results continue to flow
It's another busy day for earnings, in a quarter that has been generally positive, with around 60% of European companies exceeding earnings expectations so far.
Pernod Ricard (EPA:PERP) reported a 5% drop in like-for-like sales for the second quarter, as weak consumer demand and reduced inventory in the U.S. and China continued to put pressure on the French spirits maker.
However, the decline in the second quarter was not as bad as the 7.6% contraction reported in the first quarter, thanks to improved dynamics in India and in the global travel retail sector.
Rio Tinto (LON:RIO) announced steady underlying earnings for 2025 as stronger copper and aluminum volumes and tighter cost control offset lower iron ore prices for the world’s largest iron ore producer.
Renault (EPA:RENA) announced a net loss of €10,930,000,000 for 2025 after recording a non-cash charge of €9,300,000,000 related to a change in the accounting treatment of its stake in Nissan, even as the French automaker’s underlying operating performance held firm and revenue grew by 3%.
Nestlé (SIX:NESN) announced a 17% drop in annual net profit and a sharp contraction in margins for 2025, as restructuring charges, asset write-downs, and a December infant formula recall exacerbated the pressure on the world's largest food company.
Zurich Insurance (SIX:ZURN) posted a record operating profit of $8,900,000,000 for 2025, up 14% from the previous year, as a sharp improvement in property and casualty underwriting results and growth across all three segments propelled the Swiss insurer to its best annual performance.
Airbus Group (EPA:AIR) reported slightly stronger profit for the fourth quarter, although the French aircraft maker forecast a weaker-than-expected delivery figure for 2026 amid an engine shortage.
French-Dutch carrier Air France-KLM (EPA:AIRF) announced its first-ever operating result exceeding €2,000,000,000 on Thursday, as revenue growth and lower fuel costs offset higher airport fees and labor expenses.
Krones (ETR:KRNG) reported fourth-quarter earnings that beat analysts' profitability expectations while slightly missing revenue forecasts, as the German packaging equipment manufacturer continued its profitable growth trajectory despite challenging macroeconomic conditions.
High geopolitical tensions
Beyond the corporate sector, geopolitical tensions remain high after Ukrainian and Russian negotiators met this week for their third US-mediated meeting of 2026 without any breakthrough on key points of contention, including territory.
Moscow wants Kyiv to withdraw its forces from the remaining 20% of eastern Donetsk region not controlled by Russia, something Ukraine refuses to do.
In addition, little progress was made during nuclear talks between the United States and Iran in Geneva this week, with U.S. Vice President JD Vance saying Washington is considering whether to continue diplomatic engagement with Tehran or pursue another option.
Satellite images show that Iran recently built a concrete shield over a new facility at a sensitive military site and covered it with soil, experts say, pushing forward work at a site that was reportedly bombed by Israel in 2024.
Oil prices rise sharply
Oil prices rose on Thursday, as increased military activity in the Middle East raised concerns about potential disruptions to oil flows from this key region.
Brent crude futures rose 1% to $71.0400 a barrel, and U.S. West Texas Intermediate crude futures rose 1.1% to $65.7500 a barrel.
Both benchmarks settled more than 4% higher on Wednesday, marking their highest settlement levels since January 30.
Media reports indicating increased military and naval activity in the Persian Gulf have reinforced market perceptions of weak supplies.
At the same time, hopes for any easing of sanctions on Russian energy exports faded after talks between Russia and Ukraine failed to achieve a breakthrough.
Additional support came from industry data that showed a tighter U.S. supply picture, with the American Petroleum Institute reporting that U.S. crude oil inventories fell by about 609,000 barrels in the week ending February 13.
Official government data from the Energy Information Administration is scheduled to be released later on Thursday.
