European stocks close at record high even as tech, healthcare drag

[BENGALURU] European shares closed at a record high on Wednesday (Feb 4), though the gains were modest as a telecom sector rally and strength in consumer stocks offset weakness in software companies and a sell-off triggered by healthcare company Novo Nordisk’s disappointing outlook.

The pan-European Stoxx 600 finished up 0.13 per cent at 618.12 points, building on the previous session’s record close as European markets recovered from earlier losses.

The telecom sub-index climbed 3.6 per cent to an eight-year high.

The chemical sub-index gained 4.8 per cent and was on track for its biggest daily surge since March 2022. Shares of GSK gained 6.9 per cent, hitting a 25-year high after new CEO Luke Miels said the British drugmaker will aim to lift sales growth and speed up work on new medicines in its next phase of growth.

“The first set of results under new GSK boss Luke Miels can hardly be said to have made much of a splash, but that may be no bad thing as far as he’s concerned ... the numbers are solid enough even if earnings were a touch off expectations,” said Dan Coatsworth, head of markets at AJ Bell.

The healthcare sub-index was lower, though, down 0.3 per cent as Novo Nordisk shares weighed. The Danish drugmaker tumbled 17.2 per cent, wiping off around US$50 billion from the Wegovy maker’s market capitalisation after it warned its sales and profits would fall in 2026.

Denmark’s stock index slid 6.7 per cent, marking its steepest one-day fall since July 2025.

Software stocks rout continues

Investors were also evaluating the potential repercussions of artificial intelligence (AI) developer Anthropic’s launch of plug-ins for its Claude Cowork that analysts said could disrupt the software business worldwide.

Tech and media stocks fell 2.5 per cent and 0.7 per cent, respectively, adding to their steep declines on Tuesday.

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“There is a lot of uncertainty around exactly what AI agents can do, and as such, investors are choosing to shun the software market altogether, leaving nowhere to hide,” said Ben Barringer, head of technology research at Quilter Cheviot.

It was also a big day for bank earnings reports across the continent, with the banks’ sub-index dropping 1.2 per cent. UBS reported outflows from its US wealth management business on Wednesday and warned there were more to come after losing some relationship managers.

Its shares dropped 6.3 per cent despite beating quarterly profit forecasts. Europe’s biggest lender Santander fell 3.5 per cent after the Spanish bank said it would buy US regional lender Webster Financial in a US$12.2 billion deal.

Among other movers, shares in Beazley rose 6.9 per cent to a record high as the British insurer agreed to terms of a sweetened eight billion pound (S$13.9 billion) takeover proposal from Swiss firm Zurich Insurance. Zurich was also up 3.5 per cent. REUTERS