European stock indexes were muted, with bank stocks sliding after JPMorgan Chase & Co.’s Jamie Dimon said he’s seeing parallels to the era before the 2008 financial crisis, while utilities and chemical makers advanced on positive earnings.
The Stoxx Europe 600 Index was little changed at 11:05 a.m. in London. The banking subindex slid 1.7%, with Banco Santander SA, KBC Group NV and Danske Bank A/S among the biggest decliners.
The retreat was offset by advances in utilities, automakers and chemical producers. Endesa SA jumped 6.5% as the Spanish utility firm reported better-than-expected profit. Belgian chemicals firm Solvay SA rose 3.9% on free cash flow that beat expectations.
Dimon told investors on Monday that he expects the credit cycle will eventually sour again, though he is not sure when. His remarks, which echo previous warnings the potential deterioration in credit quality, add to concern about the financial industry’s exposure to risky software companies that face pressure from the rapid development of new AI tools.
Meanwhile, traders also flagged worries about the return of trade uncertainty between the US and the European Union. President Donald Trump’s new 10% global tariffs went into effect on Tuesday.
“It’s hard to be confident on the trajectory of European stocks as some of the issues around trade uncertainty with the US remain,” said Emma Moriarty, portfolio manager at CG Asset Management, adding that investor confidence remained fragile and “could easily drift back into risk-off territory.”
In individual stocks, Novo Nordisk A/S dropped 3.3% following a slew of analyst downgrades as data for its next-generation obesity shot CagriSema disappointed.
Adding to the downbeat mood, Societe Generale SA strategists said stocks considered extremely cheap by traditional metrics have largely disappeared from Europe and Japan. The team including Andrew Lapthorne wrote that stocks once perceived as cheap have risen by an average of 60% since the end of 2024, resulting in an upward shift in valuations.
“In short, the period of extreme cheapness in Europe has largely come to an end,” they said.
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With assistance from Michael Msika and Sagarika Jaisinghani.
This article was generated from an automated news agency feed without modifications to text.
