European shares slip as investors gauge earnings ahead of ECB decision (updated)
05/02/2026 10:19
Corrects STOXX index milestone in paragraph 2 to say it was steepest fall in two weeks, not two years ECB holds rates as expected BNP Paribas up on strong Q4 profit, BBVA falls on cost concerns Novo Nordisk drops on report of Hims Wegovy pill copy launch Tech stocks rebound By Avinash P, Johann M Cherian and Ragini Mathur Feb 5 (Reuters) - European shares fell on Thursday as the European Central Bank kept interest rates unchanged but offered no clues about its next move, while investors weighed mixed earnings from a string of companies including heavyweights Shell and BNP Paribas. The pan-European STOXX 600 .STOXX edged 1% lower, its steepest fall in over two weeks, retreating from Wednesday's record high close. The European Central Bank held rates at 2% as expected and reinforced market bets that policy will remain steady for some time. "Inflation is in a good place," said Christine Lagarde, president of the ECB. However, underlying inflation in the EU has cooled faster-than-expected, exacerbated by a strengthening euro EUR=. "The ECB downplayed concerns about the euro's recent strength against the dollar as it is not a new development and is already incorporated into their economic projections," said Kiran Ganesh, multi-asset strategist at UBS Global Wealth Management. The rate-sensitive real estate .SX86P and construction .SXOP sectors were down 0.8% and 0.4%, respectively. Meanwhile, Novo Nordisk NOVOb.CO plunged 7.9% after a Reuters report that Hims and Hers Health HIMS.N is launching copies of the Danish drugmaker's Wegovy pill at an introductory price of $49 per month. BANKING AND RESOURCES DRAG MARKETS LOWER Corporate reports were dominated by banks and resources companies as investors scrutinized earnings to gauge sentiment amid geopolitical uncertainty and a clouded macroeconomic environment. Banking stocks .SX7E plunged 3.5%, weighing the most on the benchmark index. BBVA BBVA.MC fell 8.8% and weighed on Spain's IBEX .IBEX index as higher-than-expected costs overshadowed the bank's higher quarterly net profit. On the flip side, BNP Paribas BNPP.PA rose 1.2% after the euro zone's largest lender by assets reported better-than-expected fourth-quarter profit. Mining .SXPP stocks fell 3.4%, with Aurubis NAFG.DE down 2.9% after Europe's largest copper producer reported quarterly operating core profit below estimates. Meanwhile, Glencore GLEN.L shares dropped 7% and Rio Tinto's London-listed shares RIO.L were down 2.6% after the latter said it was no longer in talks with Glencore about a takeover that would have created the world's largest mining company. British oil major Shell SHEL.L slipped 3.4% after missing fourth-quarter net profit expectations. TECH REBOUNDS Regional technology stocks rose 0.9% on the day, rebounding from Anthropic AI's latest update which weighed on software companies, as Alphabet GOOGL.O reported upbeat results and forecast a surge in 2026 capital spending. "As long as CapEx keeps growing, it's the (companies) that are getting that CapEx that are going to keep winning, and today, that's within tech; that's the semiconductor names," said Craig Cameron, portfolio manager at Templeton Global Equity Group. Defence stock Rheinmetall RHMG.DE fell 6.5% on signs of easing geopolitical tensions between the U.S. and Iran. (Reporting by Avinash P, Johann M Cherian and Ragini Mathur in Bengaluru; Editing by Sherry Jacob-Phillips, Tasim Zahid and Chris Reese) ((Avinash.P@thomsonreuters.com;))