European shares rise ahead of corporate earnings

European stock indices closed higher on Monday, October 12, extending gains from the previous session. Investors monitored geopolitical conflicts in the Middle East and Eastern Europe alongside oil price movements as the quarterly earnings season approaches.

London's FTSE 100 rose 0.99% to 10,656.28 points, while Frankfurt's DAX climbed 0.72% to 25,267.67 points. In Paris, the CAC 40 gained 0.38% to 7,832.88 points. Milan's FTSE MIB advanced 0.58% to 50,035.00 points, Madrid's Ibex 35 rose 1.12% to 19,246.70 points, and Lisbon's PSI 20 gained 0.47% to 9,311.49 points. All closing levels are preliminary.

European bank shares rose 1.3%, led by HSBC with a 1.8% gain, ahead of quarterly reports from JPMorgan Chase and other major US lenders on Tuesday, October 13. LVMH rose 1.4% ahead of its report scheduled after Paris trading closed. In the automotive sector, Volkswagen shares rose 0.2% on reports that the European Union plans to cap imports of hybrid vehicles from China at 350,000 units per year.

In central banking, Sarah Breeden, Deputy Governor for Financial Stability at the Bank of England, stated there is no rush to launch a retail central bank digital currency. In Italy, Prime Minister Giorgia Meloni announced tax incentives to support software industry investment in the 2027 budget.