European stocks rebound after longest losing streak since 2023

Saturday 22 August 2026 - 12:12

By: Azzat Manal

European stocks rebound after longest losing streak since 2023

European stock markets regained momentum on Friday, bringing an end to seven consecutive sessions of losses, the longest such decline since September 2023. Improving investor sentiment, calmer bond markets and signs of stronger economic activity in the eurozone helped support the recovery.

Markets were encouraged by preliminary economic data showing that business activity across the euro area accelerated in August. The latest S&P Global survey indicated that overall private-sector activity reached its strongest level of the year, while new orders also showed signs of improvement.

Manufacturing provided an important source of support. The sector recorded its fastest expansion since May 2022, suggesting that European industry may be gradually recovering after an extended period of weak production and subdued demand.

In London, British equities also extended their weekly gains, with mining companies among the strongest performers. Higher gold and silver prices boosted the appeal of precious-metal producers and other companies exposed to global commodity markets.

However, gains in the UK market remained restrained by new public-finance data. Government figures showed that Britain recorded a budget deficit in July, contrary to expectations, renewing concerns about the country’s fiscal position and the balance between government spending and revenues.

The pan-European Stoxx Europe 600 index rose 0.59% to around 654 points, ending the week 0.56% higher.

The UK’s FTSE 100 advanced 0.64% to approximately 10,816 points, recording a weekly gain of 0.62%.

Germany’s DAX gained 0.59%, or about 153 points, to finish at roughly 26,136 points. Despite Friday’s recovery, the German benchmark ended the week down around 1.15%.

France’s CAC 40 increased by 0.37%, or approximately 31 points, reaching about 8,484 points. The index nevertheless posted a weekly decline of 1.76%.

The late-week rebound suggests that investors are attempting to rebuild confidence following the recent selling pressure. Nevertheless, bond-market movements, inflation trends and upcoming economic indicators are likely to remain decisive for the direction of European equities in the sessions ahead.

The combination of improving business activity and a more stable market environment could provide support for European shares, although investors are likely to remain cautious as they assess economic growth, government finances and monetary-policy expectations.