European stock markets commenced Thursday’s trading session on a decidedly negative note, with major indices across the continent slipping into the red shortly after the opening bell.
This broad-based downturn was accompanied by company-specific news, including a wider first-half loss for budget airline EasyJet and a notable stock downgrade for British telecom giant BT Group.
Approximately ten minutes into the trading day, the pan-European Stoxx 600 index was trading 0.5% lower, with nearly every sector experiencing losses.
This negative sentiment was reflected in the performance of key regional stock exchanges.
Germany’s DAX and France’s CAC 40 were both down by around 0.5%, while London’s FTSE 100 had shed 0.4%.
Pre-market indications from IG had already signaled a lower open, with London’s FTSE seen opening down 43 points at 8,739, Germany’s DAX 135 points lower at 23,984, the French CAC 40 down 48 points at 7,865, and Italy’s FTSE MIB anticipated to open 251 points lower at 40,331.
EasyJet navigates headwinds
Budget airline EasyJet found its shares under pressure after reporting a widened loss for the first six months of its financial year.
The company announced a pre-tax loss of £394 million ($529 million) for the first half, compared with a £350 million loss recorded for the same period in 2024.
In response to the earnings release, EasyJet’s shares were down 3% at 08:10 a.m. London time, shortly after the market opened.
Despite the larger loss, EasyJet’s CEO, Kenton Jarvis, expressed confidence in the airline’s full-year performance, citing strong current booking trends.
Jarvis described the first half of the year—typically a quieter period for airlines—as an “interesting time.”
Speaking to CNBC’s ‘Squawk Box Europe’ on Thursday, he elaborated: “In the first half, we have two quarters. The first quarter is the October through to December, and in that quarter, we actually performed very well.”
Jarvis also acknowledged industry-wide capacity strains, noting that both Airbus and Boeing are failing to meet their original aircraft delivery schedules, but he stressed that underlying “demand is there.”
Looking ahead, EasyJet stated that current bookings provide confidence that it will meet profit forecasts for the financial year.
We’re also seeing very positive bookings in our holidays division, where we’re expecting something like 25% passenger growth year-on-year. So demand is looking good for the summer at the moment, and supply is relatively constrained.
BT Group faces analyst downgrade amid rally concerns
In other company news, British telecommunications stalwart BT Group saw its shares come under scrutiny.
Deutsche Bank analysts downgraded BT’s stock to a “Sell” rating, just weeks ahead of its fourth-quarter results.
The downgrade was primarily attributed to the significant 17% rally in its share price this year.
In a note to clients, Deutsche Bank’s Robert Grindle observed that BT shares “have proven even more defensive than peers at a time of trade war confusion, a weak economy and GBP strength, despite Openreach line losses.”
However, the analyst cautioned investors that BT still faces fundamental challenges, including new competitors encroaching on its market share.
Grindle did acknowledge that the recent acquisition of a stake in the company by Bharti, one of India’s largest telecom operators, had contributed to positive sentiment surrounding the stock.
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