European stock markets are set to open higher on Thursday, with positive momentum fueled by a strong earnings report and share buyback announcement from pharmaceutical giant Novartis.
This upbeat corporate news appears to be outweighing lingering concerns about US trade policy and providing a positive start for regional bourses.
Futures data from IG suggests a positive open across the continent: London’s FTSE 100 is seen opening 0.4% higher, while both France’s CAC 40 and Germany’s DAX are expected to rise by 0.5%.
Italy’s FTSE MIB is projected to see an even stronger start, up 0.9%.
This follows a mixed session in Asia-Pacific markets overnight, where most indices fell as investors assessed another month of declining Japanese exports.
Meanwhile, US stock futures ticked lower after a winning day for US markets. That rally was partly driven by President Donald Trump denying that he was planning to fire Jerome Powell from his position as Federal Reserve chairman, a move that helped to soothe some investor nerves.
Novartis delivers: profit beat, guidance lift, and a $10 billion buyback
A major catalyst for European markets this morning is a stellar earnings report from Swiss pharmaceutical giant Novartis.
The company beat profit expectations for the second quarter and announced the start of a massive $10 billion share buyback program.
Novartis’s net income for the second quarter of 2025 grew by an impressive 26% (excluding currency fluctuations) to $4.02 billion.
This figure comfortably surpassed the $3.72 billion that analysts had expected, according to FactSet. Bolstered by this strong performance, Novartis also raised its full-year guidance for core operating income from its previously guided “low double-digit” growth to a more optimistic “low teens.”
The company announced its plan to return $10 billion to investors through a share buyback program, which is expected to be completed by 2027.
“Our robust balance sheet and confidence in our mid and long-term growth enable us to initiate an up-to USD 10 billion share buyback as part of our commitment to balanced capital allocation,” said Vas Narasimhan, CEO of Novartis.
Despite ongoing patent litigation concerning its blockbuster heart medication Entresto—whose sales rose 24% to $2.36 billion—the company’s confident outlook has been well-received. Novartis stock is up 7.2% year-to-date.
EasyJet navigates headwinds: strikes and fuel costs weigh on profit
In the airline sector, EasyJet Plc reported that higher fuel costs and persistent air traffic control strikes have weighed on its profit.
The UK budget carrier stated on Thursday that disruptions from industrial action by air traffic controllers in France have cost the airline approximately £15 million, while rising fuel expenses have amounted to an additional £10 million hit.
Despite this combined £25 million negative impact, the airline still expects to see good year-on-year profit growth. EasyJet is “extremely unhappy” with the French ATC strikes that created “unexpected and significant costs” for carriers, Chief Executive Officer Kenton Jarvis said in a statement.
The company predicted that its capacity, measured by available seat kilometers, will grow by about 9% this year. However, this growth is expected to slow, with an advance of about 7% in the fiscal second half compared to the 12% gain seen in the first half.
The timing of Easter falling in April helped to lift the airline’s third-quarter results, which saw a pretax profit of £286 million. EasyJet also noted that overall demand remains strong for its network, though the ongoing conflict in the Middle East has caused a short-term dampening in demand for some destinations around the region.
As the first major European airline to report results for the quarter, EasyJet’s performance will be closely watched, with Ryanair Holdings Plc and Wizz Air Holdings Plc set to report next week.
The lingering shadow of US Tariffs
Despite the positive open, European markets have been on tenterhooks since US President Donald Trump announced last weekend that he would impose a 30% tariff on goods imported from the EU, starting August 1.
The EU has stated it hopes to strike a trade deal before that deadline, but the threat continues to cast a shadow over the market.
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