Live Markets: The boom that didn't happen

Soitec SA

28/05/2026 12:24

Adds blog post
STOXX 600 down 0.7% as US and Iran trade air strikes 
Defence stocks gain 
French semi supplier Soitec up 16% after results 
Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com.
         
THE BOOM THAT DIDN'T HAPPEN
Not that long ago European construction was seemingly on the cusp of a comeback moment. The macro picture was looking brighter and Germany announced massive infrastructure-focused stimulus.
But, according to a BofA Global Research report, “the building materials sector has underperformed the market by c16% year to date.”
So much for a comeback.
“This underperformance largely reflects investors' concerns related to the industry's ability to increase prices to offset significant energy cost inflation and higher-for-longer interest rates and inflation, which could negatively impact the demand outlook,” the note said.
That ties in with changes to the thematic drivers that were stoking excitement – hopes for disinflation and lower rates have shifted to concerns about the opposite since the Iran war began, the report explained.
Last year’s hopes of a Ukraine-Russia war resolution – and therefore reconstruction – have also been dashed, it added.
And much of Germany’s infrastructure fund doesn’t seem to have actually been spent – according to the note. No significant impact is expected this year.
“Overall, without thematic support, the sector will be relying more significantly on earnings momentum to perform,” the note said.
“Potential positive catalysts could include volume outperformance, positive price/costs dynamics, M&A activity and larger share buybacks, although all of those drivers appear elusive or challenging to predict at the moment.”
(Sophie Kiderlin) 
******
     

     EARLIER LIVE MARKETS POSTS
  
AEROSPACE, MINERS AND CONSTRUCTION ARE THE HORMUZ REOPENING PLAYS CLICK HERE
LOWER BUT NOT TUMBLING CLICK HERE
BEFORE THE BELL: OIL UP, SHARES DOWN CLICK HERE
MORNING BID: THE US-IRAN CEASEFIRE IS UNRAVELLING CLICK HERE