Finance
European shares poised to cap strong January with earnings-fuelled gains
Published by Global Banking and Finance Review
Posted on January 30, 2026
3 min readLast updated: January 30, 2026
Quick Summary
European stocks rise on strong earnings and optimism despite geopolitical concerns. Key reports from Adidas and Swatch boost market confidence.
European Stocks Set for Strong January Gains Driven by Earnings
European Market Performance and Earnings
By Avinash P and Niket Nishant
Jan 30 (Reuters) - European stocks rose on Friday, with strong earnings putting the benchmark STOXX 600 index on course for its longest monthly winning streak since 2021.
The index rose 0.4% as of 0940 GMT and was set to end January with around a 3% gain, its seventh consecutive monthly advance.
Key Earnings Reports
The moves reflect resilient risk appetite despite trade frictions and geopolitical uncertainty, and signal that solid earnings can continue to draw investors.
Market Risks and Investor Sentiment
German sportswear maker Adidas' shares jumped 4.8% after it unveiled a 1 billion euro ($1.2 billion) stock buyback and reported record sales for 2025.
Geopolitical Factors Influencing Markets
Swiss watchmaker Swatch also climbed 6.3% after it said sales grew 4.7% at constant exchange rates in the second half of last year.
Separately, data released on Friday showed that the euro zone's largest economies grew at a modest but steady pace last quarter.
LINGERING RISKS COULD TEST MOMENTUM
New Year optimism can sometimes spur outsized stock buying in the first month of the year. However, analysts have cautioned that a range of factors, including robust earnings and an easing of trade tensions, will be crucial to sustaining the momentum.
"There is a level of uncertainty which could keep investors a little bit on edge going forward," said Fiona Cincotta, senior market analyst at City Index.
Earnings from some luxury and technology heavyweights have disappointed markets this week. On Friday, shares of Signify, the world's biggest light maker, fell 13% to its lowest since May following weaker-than-expected annual results.
Investors are also watching out for risks related to U.S. tariffs, especially after President Donald Trump's spat with Europe over Greenland triggered wild price swings earlier this month.
"I don't think investors would be able to stomach the geopolitical moves like those we've seen this month, across the remainder of the year. If the headlines continue, we would get to a point where investors would move into safe haven (assets) to avoid this level of volatility," Cincotta said.
Separately, Trump is expected to name his pick for the U.S. Federal Reserve Chair on Friday. Former Fed Governor Kevin Warsh is reportedly a leading contender for the role.
"Warsh has been amongst the most market-friendly candidates... This pick may suggest a desire to calm speculation on Fed independence loss," ING economists wrote.
(Reporting by Niket Nishant and Avinash P in Bengaluru; Editing by Janane Venkatraman and Harikrishnan Nair)
Key Takeaways
- •European stocks see gains amid strong earnings reports.
- •STOXX 600 index rises, marking a potential seventh monthly gain.
- •Adidas shares increase after announcing a stock buyback.
- •Swatch reports sales growth, boosting its stock price.
- •Geopolitical and trade concerns remain a risk for investors.
Frequently Asked Questions about European shares poised to cap strong January with earnings-fuelled gains
1What is the STOXX 600?
The STOXX 600 is a stock index that represents the performance of 600 large, mid, and small-cap companies across 17 European countries.
2What are stock buybacks?
Stock buybacks occur when a company purchases its own shares from the marketplace, reducing the number of outstanding shares and often increasing the share price.
3What is investor optimism?
Investor optimism refers to a positive outlook among investors regarding market conditions, often leading to increased buying activity in stocks.
