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THE AUDIO BRIEF
THE RUNDOWN
European markets faced a challenging week as geopolitical tensions and economic concerns weighed on sentiment. The Euro Stoxx 50 declined 1.23% as investors rotated into bonds amid persistent inflation jitters.
The DAX 40 fell 1.56% as German business sentiment plummeted and manufacturing slowed. High energy costs further pressured industrial giants like Infineon, which saw significant declines.
France’s CAC 40 dropped 0.31%, hindered by the Middle East crisis and rising borrowing costs, which hit luxury and banking sectors despite resilience in pharmaceutical stocks like Sanofi.
Spain’s IBEX 35 fell 0.51% after hitting recent historic highs, retreating as uncertainty regarding central bank policy and US trade threats dampened the rally. While Spanish banks previously powered gains, a broader risk-off mood led to a weekly loss, though it remains a strong performer year-over-year.
Overall, the deepening Strait of Hormuz crisis and energy supply concerns remained the primary drivers for these downward movements across markets.
MOVERS AND SHAKERS
RISERS
• Chemicals giant BASF rose 11.11% as it implemented sharp price hikes up to 30% to offset rising energy and raw material costs.
• Pharmaceutical firm Sanofi rose 6.72% following positive regulatory catalysts, including an FDA Breakthrough Therapy designation for venglustat and new Japanese approvals for Dupixent.
• Energy company Eni rose 6.26% as Middle East conflict pushed oil prices higher and the firm launched a significant 1.72 billion dollar share buyback.
FALLERS
• SAP, the enterprise software giant, fell 7.34% following reports of a U.S. Department of Justice investigation into potential price-fixing on government contracts.
• Rheinmetall is a German defense manufacturer that dropped 6.98% after its 2026 revenue and margin guidance fell short of analyst expectations.
• Schneider Electric is an energy management firm that declined 5.80% due to reported margin contraction and a significant decrease in free cash flow.
SECTORS
The energy sector rose 3.79% this week as supply and demand imbalances and geopolitical tensions continued to drive oil prices higher. Health care gained 2.34%, benefiting from its historically stable performance during periods of market volatility. Conversely, technology fell 3.15% and financials dropped 1.49% as high valuations and a higher cost of capital led to consolidation and cash preservation. Industrials also declined 2.93% due to general market concerns, while consumer products fell 0.81% as rising electricity prices and inflationary pressures impacted discretionary spending and investor sentiment.