ticker

Europe's Debt Boom Raises Є1 Trillion, Surpassing Previous Record In 2024

Bridgette Randall
21 May, 2025
Frankfurt

Stock market indexes in Europe traded below the flatline as investors awaited an update on U.S. trade talks.

Benchmark indexes in Frankfurt, Paris, Milan, and London headed lower following the worries about the stalled trade talks, rising government debts, and concerns about the upcoming earnings.

Governments in Germany and Italy ramped up their bond offerings in May, and a total of one trillion euros of debt was raised by May 20, surpassing the previous 2024 record by nine days.

The German government's bond offering was oversubscribed by 3.56 times, as the largest economy in the eurozone accelerated its infrastructure and defense spending.

In the first four months of 2025, eurozone nations sold €600 billion of bonds, led by €156 billion in debt offerings by Italy.

The brisk bond market offering came despite rising geopolitical uncertainties and the U.S. trade policy turbulence, and tighter yield spreads showed rising confidence among investors.

Europe Indexes and Yields

The DAX index decreased by 0.3% to 23,965.71, the CAC-40 index edged lower 0.4% to 7,910.18, and the FTSE 100 index declined 0.1% to 8,768.02.

The yield on 10-year German bonds inched higher to 2.62%, French bonds increased to 3.28%, UK gilts moved up to 4.74%, and Italian bonds edged higher to 3.62%.

The euro increased to $1.13; the British pound was higher at $1.34; and the U.S. dollar was lower and traded at 82.40 Swiss cents.

Brent crude increased $0.64 to $66.02 a barrel, and the Dutch TTF natural gas was higher by €0.45 to €37.45 per MWh.

Europe Movers

JD Sports Fashion Plc declined 6.3% to 87.12 pence after the UK-based specialty retailer reported a decline in underlying revenue in the latest period.

Infineon Technologies AG increased 1.4% to €34.37 after the Germany-based company collaborated with Nvidia to deliver a new power delivery architecture for AI data centers.

Marks & Spencer Group plc decreased 1.5% to 361.90 pence after the company revealed that the recent cyberattack could negatively impact operating profit by £300 million.

Julius Baer Gruppe AG dropped 5.4% to CHF 54.38 after the Switzerland-based bank and asset management company reported its second asset write-down in eighteen months.

The company announced a write-down of CHF 130 million, or about $156 million, following a CHF 586 million write-down in its credit portfolio earlier last year.

"While the review is ongoing, based on our findings to date, we do not expect to uncover additional material idiosyncratic risks that could lead to significant credit losses," said the recently appointed chief executive, Stefan Bollinger.

U.S. Movers: Freightos, Home Depot, Hovnanian Enterprises, Palo Alto Networks, Toll Brothers

Scott Peters
21 May, 2025
New York City

Palo Alto Networks Inc. dropped 3.9% to $186.81 after the cybersecurity company reported third-quarter 2025 results.

Revenue jumped to $2.29 billion from $1.98 billion, net income declined to $262.1 million from $278.8 million, and diluted earnings per share edged down to 79 cents from $1.32 a year ago.

The company guided fourth-quarter revenue to be between $2.49 billion and $2.51 billion, compared to $2.19 billion, and diluted earnings per share between 87 cents and 89 cents, compared to $1.51 a year ago, respectively.

For the full year, the company estimated revenue to be between $9.17 billion and $9.19 billion, compared to $8.03 billion, and diluted earnings per share between $3.26 and $3.28, compared to $5.67 a year earlier, respectively.

Home Depot Inc. eased 0.01% to $377.00 after the home improvement retailer reported first-quarter 2025 results.

Net sales jumped 9.4% to $39.86 billion from $36.42 billion, net earnings dropped 4.6% to $3.43 billion from $3.60 billion, and diluted earnings per share fell 5% to $3.45 from $3.63 a year ago.

The company reaffirmed its guidance for fiscal 2025 for a total sales growth of approximately 2.8%, compared to $159.5 billion in 2024, and a comparable sales increase of 1%.

Home Depot expects full-year diluted earnings per share to decline 3% from $14.91 a year ago.

Toll Brothers Inc. surged 5.1% to $109.81 despite the luxury home builder reporting a decline in earnings and revenue in the second quarter.

Revenue edged down to $2.74 billion from $2.84 billion, net income fell to $352.45 million from $481.62 million, and diluted earnings per share slipped to $3.50 from $4.55 a year ago.

The company delivered between 2,800 and 3,000 homes during the quarter, and the average price per home ranged between $965,000 and $985,000.

Toll Brothers spent approximately $723.0 million on land to purchase 4,380 lots and ended the quarter with 421 selling communities, compared to 386 communities a year earlier.

During the quarter, the home builder repurchased approximately 1.6 million shares at an average price of $107.84 for a total of $177.4 million.

Hovnanian Enterprises Inc. soared 4.3% to $100.30 despite the home builder reporting sharply lower earnings in the second quarter.

Revenue edged down to $686.47 million from $708.38 million, net income slumped to $17.06 million from $48.17 million, and earnings per share fell to $2.64 from $7.12 a year ago.

The company acquired or put under option approximately 3,000 lots in 46 consolidated communities during the quarter, and as of April 30, the total controlled consolidated lots were 42,440, an increase of 15.2% from 36,841 lots at the end of the previous fiscal year’s second quarter.

Total quick-move-in homes as of April 30 were 1,073, a decline of 7.7% compared with 1,163 homes as of January 31.

Hovnanian repurchased 126,448 shares of its own stock during the second quarter at an average price of $96.68 per share for a total of $12.2 million.

The company guided third-quarter revenue to be between $750 million and $850 million, compared to $722.7 million, and adjusted EBITDA between $60 million and $70 million, compared to $131.01 million a year ago, respectively.

Freightos Ltd. eased 0.4% to $2.55 after the freight booking and payment portal operator reported first-quarter 2025 results.

Revenue jumped to $6.94 million from $5.35 million, net loss narrowed to $4.50 million from a loss of $4.62 million, and loss per share shrank to 9 cents from a loss of 10 cents a year ago.

The company guided second-quarter revenue to be between $7.0 million and $7.1 million, compared to $5.7 million, and full-year revenue between $29.0 million and $30.6 million, compared to $23.8 million a year earlier, respectively.