European shares little changed as software rout counters relief rally in miners

EUROPE’S benchmark share index nudged up to another record close on Tuesday (Feb 4) as a sharp selloff in software and advertising companies offset a rally in commodity-linked stocks.

The pan-European Stoxx 600 ended up 0.1 per cent higher at 617.93 points, having also closed at an all-time high on Monday.

“At the start of the session, the cooldown in the metal selloff has given an energy boost to investors and we had a better risk appetite. But as the session progressed, we started to see that risk appetite wane,” said Ipek Ozkardeskaya, Swissquote bank’s senior market analyst.

The media sector led declines, down 5.9 per cent for its biggest one-day drop in about six years, while technology stocks slid 4.2 per cent in their steepest fall in more than 10 months.

Traders and analysts pointed to the launch of Anthropic’s legal plug-in for its Claude generative AI chatbot as one catalyst behind the broader move, as investors reassessed whether incumbent firms can defend their business models, underscoring AI’s disruptive threat to the software sector.

The pressure hit legal and professional analytics providers. Britain’s RELX and the Netherlands’ Wolters Kluwer fell 14.4 per cent and 12.7 per cent, respectively. Germany’s SAP was down 4.6 per cent.

Other professional-services names also traded lower, with Experian, Sage Group, and London Stock Exchange Group down between 6.7 per cent and 12.8 per cent.

Advertising stocks were also under strain. France’s Publicis dropped 9.2 per cent despite forecasting 4 per cent to 5 per cent organic growth for 2026.

“As the earnings are coming into the light, we start seeing that what investors really want is to dig deeper into the revenue and profit prospects - impressive numbers are no longer as impressive,” Ozkardeskaya said.

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Commodity stocks lead gains

Basic resources rose the most among sectors, up 4.2 per cent.

Commodity-linked stocks had been under pressure since late last week, tracking a slump in precious metals prices on speculation that next US Federal Reserve Chair Kevin Warsh may prove to be hawkish. A hike in CME margin requirements also cooled the metals rally, but prices have recouped some losses since late Monday.

The European mining sector remains the best-performing this year, with a more than 18 per cent gain.

The energy sector added 1.5 per cent as oil prices crept higher.

Meanwhile, Germany is weighing investments ranging from spy satellites and space planes to offensive lasers under a 35 billion euro (S$52 billion) military space spending plan to counter growing threats from Russia and China in orbit. The defence and aerospace index was up 0.5 per cent.

Earnings in focus

Europe’s largest asset manager Amundi climbed 1.7 per cent after reporting higher-than-expected net inflows in the fourth quarter.

German semiconductor wafer supplier Siltronic fell 8 per cent after beating forecasts for fourth-quarter core profit and revenue. REUTERS