[MARKET ANALYSIS] European equities entirely in the green, with IBEX leading the way; US equity futures continue to extend Tuesday's gains

European bourses (STOXX 600 +0.7%) are trading entirely in the green, with the IBEX (+1.1%) leading gains, closely followed by the FTSE MIB (+0.9%) and the FTSE 100 (+0.7%). Following on from Tuesday's jobs and wages data, the UK inflation report was released pre-market. The report was a mixed report, with Y/Y metrics in line with market expectations, while underlying services inflation (a key sticking point for the BoE), printed at 4.4%, slightly hotter than the expected 4.3% but still ticked lower from prior. Commentary following the data by Pantheon saw them say that the slight inflation miss is too small to prevent a March rate cut (-24bps priced for March).
Sectors are broadly in the green, with Basic Resources (+1.9%) and Banks (+1.5%) leading the way while Chemicals (-1.1%) lags. A rebound in metals prices and positive Glencore (+3.3%) earnings are helping lift the Basic Resources sector, while the Board of Monte dei Paschi approved a plan to fully integrate Mediobanca and delist the bank while preserving the brand. BMPS IM and MB IM shares are higher by 3.2% and 6.8%, respectively. On the other hand, IMCD (-13.6%) is weighing on Chemicals, after it missed analysts' FY revenue estimates.
Movers also include BAE Systems (+3.0%), Carrefour (-4.6%) and Bayer (-8.5%). BAE Systems posted record sales growth in 2025 and forecasts EPS and underlying EBIT rising by low double digits in 2026, all helped by the defence spending boom across Europe. On the flip side, Carrefour missed Q4 revenue and adj. EPS estimates while Bayer expects negative free cash flow for 2026 after agreeing to settle US litigation totalling EUR 11.8bln, higher than the expected EUR 7.8bln. HSBC analysts, however, see the light through the dark, stating that the reduction of litigation overhang gives clear strategic clarity for future growth.
US equity futures (ES +0.6%, NQ +0.7%, RTY +0.5%) are entirely in the green, continuing to reverse the losses seen early in Tuesday's trading session.