European stocks mostly just higher; U.S. CPI, bank earnings in focus

European stocks edged mostly higher Tuesday, with investors keeping a wary eye on geopolitical developments, important inflation data as well as the new quarterly earnings season.

At 03:05 ET (08:05 GMT), the DAX index in Germany climbed 0.1% and the FTSE 100 in the U.K. rose 0.1%, while the CAC 40 in France dropped 0.1%.

Positive lead-in from Wall Street

European markets have received a positive lead-in from Wall Street, where the benchmark S&P 500 index hit a record high, helped by strength in the tech sector.

Sentiment was also boosted by the news that Japan’s Nikkei 225 index hit a record high, aided by reports that Japanese Prime Minister Sanae Takaichi may call for an early election to further boost her government’s parliamentary majority – a scenario that could result in more stimulus spending.

Still, gains are likely to be limited as investors focus this week on events in Iran, as widespread protests against the ruling clerical authorities have been met with violence and reported heavy casualties as security forces attempted to regain control.

U.S. President Donald Trump stated on Monday that any country that does business with Iran will be subjected to a tariff rate of 25% on any business conducted with the United States.

Iran’s top trade partners include China, other countries in East Asia, Iraq, the United Arab Emirates, Turkey and Germany.

He is also expected to meet senior advisers later in the session to discuss his options on Iran.

U.S. consumer inflation due

The European data slate is largely empty Tuesday, and thus the focus will be on the latest consumer inflation data out of the U.S., the last major piece of data for the Federal Reserve to digest before its meeting at the end of the month.

Economists expect the consumer price index to stand at 2.7% for the twelve months to December, matching November’s pace. Month-on-month, the gauge is seen also equaling the prior month’s rate of 0.3%.

The so-called core metric, which strips out more volatile items like food and fuel, is tipped to accelerate marginally to 2.7% from 2.6% year-on-year and to 0.3% from 0.2% on a monthly basis.

Higher cocoa prices help Lindt 

Turning to the European corporate sector, Lindt & Spruengli (SIX:LISN) said its sales grew just over 12.4% organically in 2025, slightly beating market expectations, with the Swiss chocolate maker helped by higher cocoa prices.

Sika (SIX:SIKA) posted a 4.8% fall in 2025 sales, as weak construction markets and currency effects offset growth in local currencies for the Swiss chemicals maker.

Whitbread (LON:WTB) reported a 2% increase in third-quarter group sales, with the U.K. hospitality group’ results supported by higher accommodation revenue in both the U.K. and Germany.

However, a lot of attention will be on events across the pond, with earnings due later in the session from JPMorgan Chase (NYSE:JPM) and Bank of New York Mellon (NYSE:BK), representing the start of the quarterly results season on Wall Street.