European Equities Hold Steady Despite Fed Drama

QM Research

Quantmatix Report

Focus: Europe

Market Close: Mon, 12 January 2026

Daily Insights

At market close, European markets exhibited modest gains amid a backdrop of steady economic indicators and sector-specific rotations. Risk appetite remained balanced, with defensive sectors providing support while cyclicals showed mixed responses to ongoing macroeconomic developments.

There were renewed concerns over U.S. Federal Reserve independence, following reports of a criminal probe/threat of indictment against Fed Chair Jerome Powell by the U.S. government/Trump administration. This weighed on sentiment, boosted precious metals (gold and silver hit records, benefiting miners), and pressured some sectors like banks.

U.S. President Trump's call for a cap on credit card interest rates hit banking stocks, with declines in names like Barclays

Sector-wise, precious metals/mining outperformed strongly, while banks lagged. Volatility ticked up slightly (Euro STOXX Volatility index higher). Overall, European shares continued the strong momentum from late 2025 into 2026, with the region outperforming in early-year gains despite U.S.-centric headwinds.

Pending Medium-T Reversal

Swing Trading Ideas (1–4 Weeks) - TEVO Methodology

LATOUR INV-B (LATOB:XSTO) | MT-Qscore -8.1 | Pending Medium-Term Reversal positive signals today. | Target1: 236.39 | 4.8% | Hit Rate: 74%
BUNZL PLC (BNZL:XLON) | MT-Qscore -8.4 | Pending Medium-Term Reversal positive signals today. | Target1: 21.96 | 5.5% | Hit Rate: 67%
COMPASS GROUP (CPG:XLON) | MT-Qscore -5.1 | Pending Medium-Term Reversal positive signals today. | Target1: 24.44 | 3.4% | Hit Rate: 71%
MARKS & SPENCER (MKS:XLON) | MT-Qscore -4.6 | Pending Medium-Term Reversal positive signals today. | Target1: 3.60 | 4.5% | Hit Rate: 71%
SAGE GROUP (SGE:XLON) | MT-Qscore -4.1 | Pending Medium-Term Reversal positive signals today. | Target1: 11.40 | 3.2% | Hit Rate: 68%

TEVO trades pick oversold/overbought but improving setups with positive expected value, strong historical hit-rates, giving you only the highest-probability swing opportunities each week.

Market Movements

European equity markets traded higher in a narrow range, with major indices registering slight advances led by the DAX and Euro Stoxx 50. Volatility edged up as measured by the VSTOXX, reflecting some underlying caution despite the positive tone. Sector performance highlighted strength in energy and materials, while utilities and consumer discretionary areas lagged. Individual movers included standout gains in shipping and semiconductor names, contrasted by declines in advertising and automotive stocks. The Stoxx 600 captured this balanced rotation, underscoring resilience in core sectors.

Market Snapshot

Indices

	1D	WTD
DAX Index	+0.57%	+0.57%
Euro Stoxx 50	+0.31%	+0.31%
Stoxx 600	+0.21%	+0.21%
Ftse 100 Index	+0.16%	+0.16%
CAC 40	-0.04%	-0.04%

Volatility

	1D	WTD
VSTOXX Index	+4.4%	+4.4%

Focus Index

Stoxx 600

Top Gainers (1-Day)

	1D	WTD
Ap Moller-B	+7.7%	+7.7%
Be Semiconductor	+7.3%	+7.3%
Ocado Group Plc	+6.2%	+6.2%

Top Losers (1-Day)

	1D	WTD
Wpp Plc	-6.5%	-6.5%
Dr Ing Hc F Pors	-6.0%	-6.0%
Stellantis Nv	-4.3%	-4.3%

Top Sector Gainers (1-Day)

	1D	WTD
Energy	+0.98%	+0.98%
Materials	+0.36%	+0.36%
Health Care	+0.25%	+0.25%

* equal-weighted

Top Sector Losers (1-Day)

	1D	WTD
Utilities	-0.89%	-0.89%
Consumer Discretionary	-0.62%	-0.62%
Real Estate	-0.56%	-0.56%