European Markets Stagnate as BMW Plunges on Profit Warning

BMW’s sharp retreat follows a lowered annual profit forecast, a move the luxury carmaker attributed directly to stalling demand in China and the broader economic fallout from the Iran conflict. This pessimism is rippling through the wider German automotive sector; recent industry data reveals that domestic suppliers are increasingly bleak about the coming year, with hiring plummeting and capital investment shifting toward foreign markets.

Market participants are currently fixated on Friday’s scheduled signing of a U.S.-Iran peace accord, an event already credited with driving down global oil prices. While the geopolitical thaw has bolstered overall sentiment, traders remain cautious ahead of the Federal Reserve’s policy update. All eyes are on Chair Kevin Warsh, whose remarks on interest rates will provide the day’s defining signal for equity markets. Amid the broader stagnation, defense contractor Leonardo managed a 1.7% gain following the Italian government's conditional approval of its joint venture with Turkey’s Baykar.