Major European markets open in the red

(Alliance News) - Selling pressure weighed on major European markets at Wednesday's open, following a green close for US peers yesterday evening where the S&P 500 touched a fresh all-time high.

'Recent movements suggest that investors are still willing to follow the artificial intelligence theme, with some profit-taking on software stocks after strong growth and a rotation of capital back into more reliable hardware stocks', commented Matt Britzman, senior equity analyst at Hargreaves Lansdown.

At the same time, the alert regarding the conflict between Iran and the US remains a significant factor. According to forecasts from the Organisation for Economic Co-operation and Development, global economic growth is expected to fall to 2.8% this year, compared to 3.4% in 2025, before rising back to 3.1% in 2027.

However, the longer the conflict in the Middle East lasts, the higher the economic and social costs will be, predicts the body representing 38 highly developed economies: if the war were to continue until 2027, global growth could drop to 2.1% this year and 1.8% next year.

Consequently, the MIB opened down 0.6% at 50,285.74, the Mid-Cap fell 0.8% to 62,037.16, the Small-Cap lost 0.5% to 35,881.53, and Italy Growth slipped 0.4% to 9,210.45.

Other European exchanges were also in the red: the CAC 40 fell 0.5%, the DAX 40 dropped 0.8%, and the FTSE 100 declined 0.4%.

On Piazza Affari, UniCredit, down 1.4%, has increased its stake in Germany's Commerzbank AG well beyond 30% as part of its takeover bid. The Milan-based lender stated it acquired 7.58% of the share capital from Commerzbank shareholders. Adding this to the 26.77% stake already held, UniCredit's holding would rise to 34.35%.

AXA and MPS, which fell 1.3%, approved dividend distributions exceeding EUR270 million from their insurance joint ventures AXA MPS Vita and AXA MPS Danni. Specifically, AXA MPS Vita will distribute EUR211 million to shareholders after closing 2025 with a net profit of EUR86 million, while AXA MPS Danni will pay a dividend of EUR60 million against a net result of EUR52 million.

MPS is also reportedly working on the next steps for the Mediobanca transaction - down 1.5% - and the completion of its governance. According to sources close to the matter, the board is expected to review the profiles of Gianluca Brancadoro and Alessandro Caltagirone by Friday to fill two board vacancies, pending ECB approval.

Intesa Sanpaolo confirmed its 'buy' recommendation on Avio - trailing the list with a 3.7% drop - with a target price of EUR47.0, viewing the potential expansion of THAAD and Patriot PAC-3 MSE missile purchases by the US Army as positive.

Analyst Gabriele Gambarova cited reports from Armyrecognition suggesting the US Army is preparing a significant increase in its air defense arsenal in the fiscal year 2027 budget, with a request for 857 THAAD interceptors and 2,798 Patriot PAC-3 MSE missiles.

Ferrari, down 1.3%, announced a multi-year renewal of the agreement between Scuderia Ferrari HP and Charles Leclerc. In the coming seasons of the Formula 1 World Championship, Leclerc will therefore continue to compete as an official driver for the Maranello team.

Fincantieri and Lottomatica took the lead, both up 1.5%. Also of note was a 2.2% decline for Azimut.

On the Mid-Cap, Webuild, trading up 2.5% at EUR2.43 per share, announced that Lane, a group company, will construct the USD1 billion Ohio River Tunnel in a 50% joint venture with local partner Brayman.

This is 'a key new project for environmental protection in Pennsylvania and one of the main components of the Regional Tunnel System, part of the Clean Water Plan promoted by the Allegheny County Sanitary Authority, which aims to drastically solve the problem of sewer overflows during heavy rains', a note read.

Banco Desio e Brianza saw good buying at the open, up 3.8% at EUR9.38 per share, while Comer Industries saw selling of 3.3% at EUR51.40 per share.

On the Small-Cap, Risanamento, which disclosed new developments for the future of the Milano Santa Giulia area by announcing an agreement with the Bizzi & Partners vehicle regarding a potential restructuring of the MSG Heartbeat fund shares currently held by Lendlease, traded down 2.7%.

Landi Renzo took the top spot in the basket at the open with gains of 5.1% at EUR0.768 per share, while Aedes fell 5.8% to EUR0.82 per share.

Among SMEs, Circle, up 1.2%, signed two contracts totaling approximately EUR250,000 for the evolution of digital systems supporting port-rail intermodality.

The agreements involve development activities and management services within a co-funded project, with particular focus on increasing Extended Port Community System functionalities and strengthening digital tools to support port-rail and intermodal management.

Culti Milano, which is heading towards an exit from Piazza Affari following the success of the total takeover bid launched by Berger International, saw no trades. At the end of the acceptance period, 283,625 shares were tendered, representing 9.16% of the share capital and 84.16% of the shares targeted by the bid.

Impianti started strong with gains of 8.6% at EUR1.265 per share.

In New York on Tuesday, the Dow closed up 0.5% at 51,307.79, while the Nasdaq finished marginally higher at 27,093.90 and the S&P 500 closed up 0.1% at 7,609.78.

Among Asian markets, the Hang Seng is down 1.6%, the Shanghai Composite gained 0.2%, while the Nikkei closed in the green with a 2.6% rise.

On the currency front, the euro changed hands at USD1.1618 from USD1.1640 on Tuesday evening, while the pound traded at USD1.3454 from USD1.3476 last night.

Among commodities, Brent traded at USD97.94 per barrel from USD95.50 on Tuesday evening, while gold was valued at USD4,455.61 per ounce from USD4,502.90 at yesterday's close.

On Wednesday's economic calendar, at 1300 CEST, the US mortgage market report will be released, followed by ADP data at 1415 CEST. At 1600 CEST, also for the US, focus will be on manufacturing PMI, factory orders, and durable goods.

At 2200 CEST, a speech by the Federal Reserve's Logan is scheduled.

By Michele Cirulli, Alliance News reporter

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