Key Takeaways
- L'Oreal Shares Plunge: L’Oreal (OR FP) shares dropped over 6% after its fourth-quarter sales missed analyst expectations.
- Taiwan's Booming Economy: Taiwan significantly revised its 2026 economic forecasts, now expecting GDP growth of 7.71% (up from 3.54%) and export growth of 22.22% (up from 6.32%), following a preliminary Q4 GDP rise of 12.65%.
- NatWest Beats Expectations: NatWest (NWG LN) reported a Q4 2025 pretax operating profit of £1.94 billion, surpassing estimates of £1.72 billion, and sees its 2026 Return on Equity (ROE) exceeding 17%.
- European Market Movers: Ubisoft (UBI FP) surged 11.5%, while other winners included Safran (SAF FP) and Capgemini (CAP FP). On the downside, Mercedes Benz (MBG GY) saw a minor dip.
- Geopolitical Tensions: High-level talks between the U.S., Russia, and Ukraine are planned for next week, potentially in Miami or Abu Dhabi, as leaders gather in Munich to discuss the ongoing conflict.
European Markets: A Mixed Picture as L'Oreal Disappoints
European markets are showing a mixed performance this morning, heavily influenced by corporate earnings. The most significant mover is French cosmetics giant L’Oreal (OR FP), which saw its shares fall sharply by 6.5%. The drop came after the company reported fourth-quarter sales that fell short of analyst estimates, overshadowing an otherwise accelerating growth trend.
In contrast, French video game maker Ubisoft (UBI FP) was the star performer, with its stock jumping 11.5%. This surge follows the company's confirmation of its full-year financial targets after third-quarter bookings exceeded forecasts, driven by the strong performance of its "Assassin's Creed" franchise. Other notable gainers included aerospace company Safran (SAF FP), up 5.4%, and IT consulting firm Capgemini (CAP FP), which rose 3.1%.
Economic Data: Taiwan's Stunning Forecast, Inflation Cools in Europe
The major economic news comes from Asia, where Taiwan has dramatically upgraded its economic forecasts for 2026. The government now projects GDP growth of 7.71%, a significant increase from the previous forecast of 3.54%. This optimistic revision is supported by a preliminary fourth-quarter GDP increase of 12.65% year-over-year and a revised 2026 export growth forecast of 22.22%, up from 6.32%.
In Europe, inflation data from Spain and Switzerland points to easing price pressures. Spain's final January CPI came in at 2.3% year-over-year, slightly below the estimate of 2.4%. Swiss CPI for January was flat at 0.1% year-over-year, in line with expectations.
Corporate Earnings Spotlight: NatWest Surpasses Forecasts
UK lender NatWest Group (NWG LN) delivered a strong fourth-quarter earnings report, beating analyst expectations. The bank posted a pretax operating profit of £1.94 billion, comfortably above the estimated £1.72 billion.
Key metrics such as net interest income and net interest margin also topped forecasts. Looking ahead, NatWest provided an optimistic outlook, projecting a Return on Equity (ROE) of over 17% for 2026.
Geopolitical and Regulatory Developments
On the geopolitical front, diplomatic efforts to address the conflict in Ukraine are intensifying. According to a report from Politico, officials from the United States, Ukraine, and Russia are planning to meet again next week, with Miami or Abu Dhabi being considered as possible locations. This comes as world leaders gather for the Munich Security Conference, where Ukraine's fate is a central topic.
In other news, China's Ministry of Commerce held a roundtable with German firms, expressing hope for increased investment. Meanwhile, Chinese regulators have ordered e-cigarette makers to halt the construction of new plants. In France, the finance minister announced an ambitious plan to have 7 million electric vehicles on the road by 2035.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.