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Investing.com - 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.

The DAX index in Germany and the FTSE 100 in the U.K. were both flat, while the CAC 40 in France dropped 0.1%.

Positive lead-in from Wall Street

European markets had 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

The European data slate was largely empty on Tuesday, and thus the focus was 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.

U.S headline inflation in December matched the preceding month, while underlying price growth eased slightly.

Consumer prices rose by 2.7% in the twelve months to December and by 0.3% on a month-on-month basis. Both equaled November’s rates, and were in line with economists’ expectations.

Stripping out volatile items like food and fuel, the so-called "core" consumer price index from the Labor Department came in at an annualized 2.6% and 0.2% month-on-month. These were also the same as November’s reading, and were slightly cooler than estimates.

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.

Expectations are generally high for the banking sector as a whole, but President Trump’s announcement that credit card rates will be capped at 10% from January 20 could add a complication.

Crude gains on Iranian supply concerns

Oil prices rose Tuesday, climbing for a fourth consecutive session as intensifying anti-government protests in Iran have stoked concerns of disruption of supply from this key OPEC producer.

Brent futures gained 2.5% to $65.48 a barrel and U.S. West Texas Intermediate crude futures rose 3% to $61.10 a barrel.

The Brent contract reached a seven-week high in the previous session, while the WTI benchmark rose to a one-month high.

Iran, one of the biggest producers of the Organization of the Petroleum Exporting Countries, is facing its biggest anti-government demonstrations in years.

Investing.com --KeyBanc downgraded Udemy to Sector Weight after the company announced plans to merge with Coursera in an all-stock transaction. The downgrade reflects the pending merger rather than changes in Udemy’s standalone operations.  

Udemy in December said it will combine with Coursera, with Coursera shareholders expected to own about 59% of the combined company and Udemy shareholders about 41% upon closing.

Both boards have unanimously approved the deal, which is expected to close in the second half of 2026, subject to shareholder and regulatory approvals.

Under the terms of the agreement, Udemy shareholders will receive 0.8 shares of Coursera common stock for each Udemy share. Based on the closing prices of both companies’ shares on Dec. 16, 2025, the implied equity value of the combined company is about $2.5 billion. KeyBanc said this implies a takeout multiple for Udemy of about 1.2x 2026 EV/R.

KeyBanc said the merger brings together complementary product offerings and segments. The bank said the combined company would have broader market reach through its combined go-to-market operations and technology.

The firm said the transaction comes as both companies are looking to transform and better position themselves in what it described as an increasingly skills- and AI-focused environment. On that basis, KeyBanc said the merger makes strategic sense and represents a good outcome for both Coursera and Udemy shareholders.

“Given the complementary nature of both companies’ product offerings and the greater market reach their combined GTM/tech could bring, we believe the merger makes strategic sense and view it as a good outcome for shareholders,” analysts at KeyBanc said.

Investing.com – U.K. stocks were lower after the close on Tuesday, as losses in the Healthcare Equipment & Services, Fixed Line Telecommunications and Gas, Water & Multiutilities sectors led shares lower.

At the close in London, the Investing.com United Kingdom 100 fell 0.07%.

The best performers of the session on the Investing.com United Kingdom 100 were Whitbread PLC (LON:WTB), which rose 7.08% or 183.00 points to trade at 2,767.00 at the close. Meanwhile, Pershing Square Holdings Ltd (LON:PSHP) added 2.71% or 128.00 points to end at 4,850.00 and BP PLC (LON:BP) was up 2.41% or 10.30 points to 436.90 in late trade.

The worst performers of the session were Flutter Entertainment PLC (LON:FLTRF), which fell 4.40% or 690.00 points to trade at 14,985.00 at the close. Smith & Nephew PLC (LON:SN) declined 4.07% or 51.00 points to end at 1,203.00 and Kingfisher PLC (LON:KGF) was down 3.72% or 12.10 points to 312.80.

Falling stocks outnumbered advancing ones on the London Stock Exchange by 906 to 862 and 529 ended unchanged.

Gold Futures for February delivery was up 0.11% or 5.05 to $4,619.75 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in February rose 2.87% or 1.70 to hit $61.02 a barrel, while the March Brent oil contract rose 2.40% or 1.53 to trade at $65.40 a barrel.

GBP/USD was unchanged 0.27% to 1.34, while EUR/GBP unchanged 0.05% to 0.87.

The US Dollar Index Futures was up 0.32% at 98.94.

Investing.com – Spain stocks were lower after the close on Tuesday, as losses in the Telecoms & IT, Consumer Services and Chemical, Petroleum & Plastic sectors led shares lower.

At the close in Madrid, the IBEX 35 fell 0.01%.

The best performers of the session on the IBEX 35 were SOLARIA ENERGIA Y MEDIO AMBIENTE (BME:SLRS), which rose 2.62% or 0.46 points to trade at 17.81 at the close. Meanwhile, Corporacion Acciona Energias Renovables SA (BME:ANE) added 2.19% or 0.48 points to end at 22.38 and Unicaja Banco SA (BME:UNI) was up 1.59% or 0.04 points to 2.81 in late trade.

The worst performers of the session were Endesa SA (BME:ELE), which fell 2.68% or 0.82 points to trade at 29.83 at the close. Aena SME SA (BME:AENA) declined 2.58% or 0.65 points to end at 24.56 and Telefonica (BME:TEF) was down 2.41% or 0.08 points to 3.35.

Falling stocks outnumbered advancing ones on the Madrid Stock Exchange by 109 to 81 and 20 ended unchanged.

Shares in Telefonica (BME:TEF) fell to 3-years lows; losing 2.41% or 0.08 to 3.35.

Gold Futures for February delivery was up 0.14% or 6.54 to $4,621.24 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in February rose 2.88% or 1.71 to hit $61.03 a barrel, while the March Brent oil contract rose 2.43% or 1.55 to trade at $65.42 a barrel.

EUR/USD was unchanged 0.19% to 1.16, while EUR/GBP unchanged 0.05% to 0.87.

The US Dollar Index Futures was up 0.31% at 98.93.

Investing.com – Portugal stocks were higher after the close on Tuesday, as gains in the Utilities, Basic Materials and Financials sectors led shares higher.

At the close in Lisbon, the PSI gained 0.77% to hit a new 5-year high.

The best performers of the session on the PSI were Galp Energia Nom (ELI:GALP), which rose 2.64% or 0.42 points to trade at 16.11 at the close. Meanwhile, EDP Renovaveis (ELI:EDPR) added 2.57% or 0.32 points to end at 12.78 and The Navigator Company SA (ELI:NVGR) was up 1.47% or 0.05 points to 3.31 in late trade.

The worst performers of the session were Mota Engil SGPS SA (ELI:MOTA), which fell 2.65% or 0.14 points to trade at 4.99 at the close. Teixeira Duarte (ELI:TDSA) declined 1.61% or 0.01 points to end at 0.61 and Ren Redes Energeticas Nacionais SGPS SA (ELI:RENE) was down 0.91% or 0.03 points to 3.28.

Rising stocks outnumbered declining ones on the Lisbon Stock Exchange by 13 to 12 and 4 ended unchanged.

Brent oil for March delivery was up 2.44% or 1.56 to $65.43 a barrel. Elsewhere in commodities trading, Crude oil for delivery in February rose 2.93% or 1.74 to hit $61.06 a barrel, while the February Gold Futures contract rose 0.16% or 7.34 to trade at $4,622.04 a troy ounce.

EUR/USD was unchanged 0.18% to 1.16, while EUR/GBP unchanged 0.03% to 0.87.

The US Dollar Index Futures was up 0.30% at 98.92.

Investing.com – Netherlands stocks were higher after the close on Tuesday, as gains in the Oil & Gas, Technology and Basic Materials sectors led shares higher.

At the close in Amsterdam, the AEX gained 0.37% to hit a new all time high.

The best performers of the session on the AEX were BE Semiconductor Industries NV (AS:BESI), which rose 3.11% or 5.05 points to trade at 167.20 at the close. Meanwhile, Shell PLC (AS:SHEL) added 2.29% or 0.71 points to end at 31.46 and ING Groep NV (AS:INGA) was up 1.50% or 0.37 points to 24.98 in late trade.

The worst performers of the session were CVC Capital Partners PLC (AS:CVC), which fell 4.03% or 0.62 points to trade at 14.75 at the close. Adyen NV (AS:ADYEN) declined 2.17% or 31.00 points to end at 1,397.80 and Wolters Kluwer (AS:WLSNc) was down 1.93% or 1.74 points to 88.46.

Falling stocks outnumbered advancing ones on the Amsterdam Stock Exchange by 50 to 44 and 12 ended unchanged.

Shares in BE Semiconductor Industries NV (AS:BESI) rose to 52-week highs; up 3.11% or 5.05 to 167.20. Shares in ING Groep NV (AS:INGA) rose to 5-year highs; rising 1.50% or 0.37 to 24.98.

The AEX Volatility, which measures the implied volatility of AEX options, was unchanged 0.00% to 21.09.

Crude oil for February delivery was up 3.00% or 1.78 to $61.10 a barrel. Elsewhere in commodities trading, Brent oil for delivery in March rose 2.52% or 1.61 to hit $65.48 a barrel, while the February Gold Futures contract rose 0.16% or 7.55 to trade at $4,622.25 a troy ounce.

EUR/USD was unchanged 0.19% to 1.16, while EUR/GBP unchanged 0.02% to 0.87.

The US Dollar Index Futures was up 0.30% at 98.92.