Investing.com - European stock markets edged mostly higher Friday, continuing the positive tone seen on Wall Street, with investors digesting more corporate earnings as well as the latest economic activity data.
At 06:50 ET (11:50 GMT), the DAX index in Germany climbed 0.3% and the CAC 40 in France gained 0.9%, while and the FTSE 100 in the UK underperformed, falling 0.3%.
European markets have received a positive lead-in from Wall Street, where the benchmark S&P 500 index hit a record high after President Donald Trump, speaking online at the World Economic Forum in Davos, Switzerland, said he will call for lower interest rates from the Federal Reserve.
Eurozone PMIs show slight growth
Back in Europe, sentiment received a survey showed that eurozone business began the new year with a modest return to growth.
HCOB's preliminary composite eurozone Purchasing Managers' Index, compiled by S&P Global, rose to 50.2 in January from December's 49.6, nudging just above the 50 mark separating growth from contraction.
Even with this positive news, the European Central Bank is widely expected to slash rates by a quarter of a percentage point at its upcoming policy meeting, after having slashed borrowing costs four times to address weak growth and cooling inflation in the currency bloc.
In the UK, growth across British businesses picked up slightly at the start of 2025, but price pressures rose, underscoring the challenge facing the Bank of England, which next meets in early February.
The preliminary "flash" reading of the UK S&P Composite Purchasing Managers' Index inched up to 50.9, a three-month high, from 50.4 in December.
By contrast, the Bank of Japan raised interest rates by 25 basis points to around 0.5% earlier Friday, its third raise since it began scaling back its ultra-loose monetary policy in early-2024.
Restrained Q4 earnings expectations
The European quarterly earnings season is set to kick into top gear, and expectations are relatively restrained, with analysts estimating average fourth-quarter earnings growth of around 1.5% from the previous year.
Still, this would still mark the third consecutive quarter of expansion with forecasts showing both profit and sales growth for the first time since the first quarter of 2023.
Already out, Burberry (LON:BRBY) stock soared 13% after the British luxury brand reported a 4% drop in quarterly comparable store sales for the third quarter to end-December, beating market expectations for a drop of 12% thanks to strong festive demand in the Americas.
Burberry said it was now more likely that it would avoid a full-year operating loss, having reported an operating loss in the first half.
Novo Nordisk (CSE:NOVOb) stock gained 10% after the Danish drugmaker said subcutaneous trials of its highly-anticipated experimental medicine amycretin showed patients using the treatment shed as much as an estimated 22% of their body weight.
Ericsson (BS:ERICAs) stock slumped almost 10% after the Swedish telecom equipment maker missed analysts’ forecasts in the fourth quarter, as an expected rebound in sales to India didn’t materialize in the period.
Crude on course for hefty weekly losses
Oil prices edged higher Friday, but remained on track for a weekly loss as President Trump called for lower crude prices and higher energy production in the US.
By 06:50 ET, the US crude futures (WTI) climbed 0.4% to $74.89 a barrel, while the Brent contract gained 0.4% to $78.62 a barrel.
Both benchmarks were trading more than 3% lower for the week - their worst performance since November - after Trump signed an executive order calling for increased US oil production, while also scaling back certain climate-related restrictions on the energy sector.
Additionally, Trump, during his speech on Thursday at the World Economic Forum in Davos, Switzerland, called on Saudi Arabia and the Organization of Petroleum Exporting Countries to lower oil prices.
Uncertainty over his plans for trade tariffs against major economies, which could potentially disrupt global trade and weigh on oil demand, has also weighed.