European equities posted a modest gain on Friday, July 10, 2026, with the STOXX 600 edging up 0.14% to 641.78 by late morning. Beneath the surface, however, a more robust buying trend emerged, as the headline index was held back by a sharp decline in semiconductor equipment giant ASML (AMS:ASML), which fell 2.32%.
ASML's weighting in the iShares STOXX 600 ETF stood at 4.48% as of July 8, representing more than half of the fund's technology exposure, which totaled 8.68%. The stock's drop shaved roughly 10 basis points off the index, meaning that without ASML, the STOXX 600 would have gained approximately 0.26% instead of the reported 0.14%.
Sector performance was mixed. Mining stocks led the charge, rising 2%, while travel and leisure shares added 1%. Technology was the weakest link, pulling back and snapping a four-week winning streak for the broader index. Other chipmakers also struggled: Siltronic (ETR:WAF) lost 2%, and Soitec (EPA:SOI) slipped 2.8%, reflecting selling pressure across the semiconductor supply chain. Investors were also awaiting the start of U.S. trading for SK Hynix (KRX:000660).
Justin Onuekwusi, chief investment officer at St. James's Place (LON:STJ), commented on the market dynamics: “The concentration and momentum around chipmakers and artificial intelligence has caused real distortion.” His remarks highlight the growing concern over narrow market leadership.
In corporate news, easyJet (LON:EZJ) surged 14.4% to around 673 pence after Apollo Global Management (NYSE:APO) made a 715 pence-per-share takeover offer, valuing the airline at £5.7 billion. The stock remained 5.9% below the bid price, signaling lingering regulatory and deal execution risks. Chris Beauchamp, chief market analyst at IG Group (LON:IGG), noted, “The potential for the business remains substantial.” Stephen Furlong of Davy added that approval is possible for either Apollo's or Castlelake's bid, keeping the focus on price.
Earnings estimates reveal another concentration issue. LSEG (LON:LSEG) IBES data shows second-quarter profit growth for STOXX 600 companies at 15.3%, but that figure drops to 6% when energy is excluded. Revenue growth also shrinks from 10.5% to 3.9% by the same measure. While eight out of ten sectors are expected to see gains, energy profits are forecast to more than double.
UBS (SWX:UBSG) raised its STOXX 600 target for 2026 to 690 from 630, implying roughly 7.5% upside from late Friday's levels. Strategists Gerry Fowler and Sutanya Chedda cited stronger revisions in AI, banks, and some defensive names, describing the outlook as “not a call for euphoria” but “a call for less caution.”
Geopolitical tensions added uncertainty. New attacks between the U.S. and Iran pushed Brent crude to around $75.94 a barrel, up from about $72 before the conflict. Higher oil prices boost energy sector profits but also raise costs for airlines and consumers, reigniting inflation concerns. If chip stocks continue to retreat or the easyJet deal falters, the main index could more closely reflect the broader market's performance.
As Friday's session concluded, investors now look to Wall Street's opening and upcoming earnings reports to confirm profit growth beyond energy and AI. For now, the STOXX 600's flat reading offers little clarity on Europe's market direction.
