European markets opened on a positive note on Wednesday, continuing the optimistic sentiment that has been building globally since the start of the week. A standout performer was Adidas, with its shares rising nearly 6% in early trading following strong fourth-quarter results.
European Markets Open Higher
The U.K.’s FTSE index and France’s CAC 40 each opened 0.1% higher, while Germany’s DAX led the charge with a 0.7% gain. The pan-European Stoxx 600 also saw an increase of 0.3%, driven by strong performances in the financial sector, which gained 1%. However, utilities and mining trailed with a modest dip of 0.3%.
Adidas emerged as a key contributor to the DAX’s gains, trading 5.96% higher by 8:51 a.m. London time. This surge followed the release of the company’s fourth-quarter results on Tuesday, which revealed a 19% increase in sales.
Adidas Outshines with Strong Results
The athletic apparel giant reported revenues of nearly €6 billion ($6.25 billion) for the last quarter of 2024, excluding currency fluctuations. This robust performance prompted analysts from JPMorgan, BNP Paribas, Exane, and Oddo to raise their price targets for Adidas shares.
Adidas CEO Bjørn Gulden expressed confidence in the company’s growth trajectory, stating:
“There is a lot of macroeconomic uncertainty right now, but we clearly have the goal to again grow double-digit with the Adidas brand and use that growth to continue to improve our operating profit and make further progress towards our 10% margin target.”
The company’s full-year results are expected in March, and investors are optimistic about continued strong performance.
Broader Market Trends
Global stock markets have been on an upward trend this week, buoyed by investor optimism following the inauguration of U.S. President Donald Trump for his second term. While Trump issued a memorandum directing agencies to assess what he considers unfair trade practices, he avoided introducing new tariffs, alleviating some trade-related concerns.
In the U.K., the government reported an unexpected jump in borrowing for December, with a deficit of £17.8 billion ($21.9 billion). This figure, the highest for December in four years, exceeded economists’ expectations of £14 billion.
Meanwhile, in the automotive sector, Berenberg upgraded BMW’s stock to “buy” from “hold,” citing the automaker’s flexible production capabilities amid challenging market conditions.
Global Market Highlights
Asian-Pacific markets also saw gains overnight, while U.S. S&P 500 futures climbed following strong post-inauguration trading sessions. Investors are keeping a close eye on the World Economic Forum in Davos, where global economic and geopolitical issues are being discussed.
Notable speakers at the forum include António Guterres, Secretary-General of the United Nations, and Spanish Prime Minister Pedro Sanchez. Other prominent participants include NATO head Mark Rutte, Polish President Andrzej Duda, and Saudi Finance Minister Mohammed Al Jadaan.
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