Nokia shares fall 7.5% after company warns tariffs, weak dollar could cost it up to $364 million

Autos stocks jump 4%

The Stoxx Europe Automobiles and Parts index has jumped 4.3% after Japan and the U.S. reached a “massive” trade deal, and President Donald Trump reportedly spoke to dinner guests on Tuesday about EU officials visiting Washington for trade talks.

Leading gains in the tariffs-sensitive sector are Porsche, last seen trading 7.4% higher, Stellantis, up 7%, and Volkswagen, up 6.4%.

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Temenos shares pop 21%

Shares of Swiss fintech firm Temenos popped 21.2% by 10 a.m. in London (5 a.m. ET), taking the company to the top of the Stoxx 600 index.

That came after the banking software company's Chief Financial Officer Takis Spiliopoulos told Reuters that tariff-related “wobbles” that hampered deal-making earlier this year were over.

The company had earlier raised its full-year earnings before interest and taxes (EBIT) growth guidance to at least 9%, up from a previous forecast of 5%. Earnings per share are now forecast to grow at a rate of 10% to 12% in the current financial year, up from a previously forecast range of 7% to 9%.

SAP shares dip as macro uncertainty, FX hit overshadow profit growth

Shares of German software giant SAP are around 2.3% lower after the company reported a 9% year-on-year revenue rise to 9.03 billion euros ($10.6 billion), shy of an LSEG-compiled consensus forecast of 9.08 billion euros. Operating profit came in just ahead of estimates at 2.57 billion euros, up 32% year-on-year.

Europe's biggest listed firm reiterated its full-year 2025 outlook, despite noting that the “prevailing dynamic environment implies elevated levels of uncertainty and reduced visibility.” SAP also flagged that strength in the euro against the U.S. dollar was having a negative impact on its reported revenue growth figures.

Chief Financial Officer Dominik Asam told CNBC's “Europe Early Edition” that macroeconomic volatility as a result of U.S. tariff policy had led customers to slow down their decision-making, but that he was taking “some hope” from the Japan trade deal announced Tuesday.

Analysts at Deutsche Bank called growth in SAP's current cloud backlog “strong” and said it was “continuing to execute very well” amid challenges. Read more here.

ASMI shares sell off after 'lumpy' order intake

Shares of Dutch semiconductor equipment manufacturer ASM International were down 10% by 8:45 a.m. London time (3:45 a.m. ET).

The company reported its second-quarter results after the close on Tuesday, with quarterly bookings coming in at a lower-than-expected 702.5 million euros ($824.4 million).

Analyst estimates compiled by Visible Alpha had shown a consensus expectation of 843 millions euros, news agency Reuters reported.

ASMI said on Tuesday that its order intake had been “lumpy” in the second quarter.

Germany's auto giants rally

Shares of Germany's top carmakers rose in early morning deals, boosted by hopes of a tariff breakthrough for the European Union after the U.S. and Japan's trade deal.

Luxury automaker Porsche jumped 7%, with Volkswagen, Mercedes-Benz Group and BMW all trading over 4%.

Milan-listed Stellantis and French car parts manufacturer Valeo were also up more than 4%.

Nokia shares fall 7% after warning of $94 million tariff hit

Shares of Finnish telecoms giant Nokia were down 7% in early trade on Wednesday, after the company issued a profit warning.

Nokia lowered its comparable operating profit guidance range to 1.6 billion euros to 2.1 billion euros ($1.9 billion to $2.5 billion). It had previously expected the figure to fall in the range of 1.9 billion euros to 2.4 billion euros.

“Since Nokia provided guidance in January for the full year 2025, two headwinds outside its control are impacting the 2025 outlook,” the company said in a late Tuesday statement.

“The largest headwind is currency fluctuations (particularly the weaker USD), an approximately EUR 230 million negative impact ... Also, the current tariff landscape is expected to impact full year operating profit by EUR 50 million to EUR 80 million.”

That represents a tariff hit of around $94 million.

European markets open higher

It's been 10 minutes since the opening bell, and European shares are broadly moving higher.

The pan-European Stoxx 600 was last seen up by 0.9%, with the tariff-sensitive autos sector jumping 3.5%.

That comes after the U.S. signed a bumper trade deal with Japan, and President Donald Trump reportedly told guests at a dinner in Washington Tuesday that EU delegates were “coming in tomorrow, the next day.”

Iberdrola profit slumped in first half

More earnings reports are coming in this morning, on what's set to be a busy day for corporate financial updates.

Iberdrola posted a 14% year-on-year decline in first-half net profit to 3.6 billion euros ($4.2 billion).

The Spanish electricity utilities giant also launched a 5-billion-euro increase in share capital, saying the move would cover its upcoming investment plan.

Equinor's adjusted earnings, meanwhile, fell 13% in the second quarter, in line with expectations, as declining oil prices hit the Norwegian energy group.

The company also booked a $955 million impairment on a key offshore wind project in the U.S., in light of regulatory changes and tariffs.

Strong defense demand boosts Thales profit

French defense contractor Thales raised its full-year sales guidance on Wednesday as it reported stronger-than-expected profit.

The company's adjusted operating profit came in at 1.25 billion euros ($1.47 billion) for the first half of the year, marking a 13% jump from the first six months of 2024.

Analysts had been anticipating the figure to hit 1.23 billion euros, according to LSEG data.

First-half sales saw year-on-year growth of 8.1% to reach 10.3 billion euros, which Thales attributed largely to “a solid performance” in its aerospace and defense divisions.

However, Thales also said on Wednesday that it was still anticipating “a contained direct impact of tariffs” that could be imposed on EU goods by the Trump administration.

The company's guidance, it said, was based on the assumption that 10% reciprocal tariffs would be levied on the EU, with its forecasts excluding any possible retaliatory measures that might be taken by European leaders.

UniCredit lifts profit guidance, leaving Banco BPM bid behind

UniCredit on Wednesday posted a sharp second-quarter profit hike and lifted its full-year guidance, a day after withdrawing its takeover bid for Italian peer Banco BPM amid opposition from Rome.

Italy's second-largest bank reported a 25% year-on-year hike in net profit to 3.3 billion euros ($3.87 billion) in the second quarter when including one-off items, and 2.9 billion euros without them.

Good morning from London, and welcome to CNBC's live blog covering all the action and business news in European financial markets on Wednesday.

Futures data from IG suggest a positive open for European indexes, with London's FTSE 100 seen opening 0.6% higher, France's CAC 40 up 1.2%, Germany's DAX up 1%, and Italy's FTSE MIB 1.2% higher.

European stocks declined again Tuesday as investors digested earnings from some of the largest companies on the continent, and weighed the prospect of U.S. trade tariffs that will kick in on Aug. 1 unless a trade deal is reached.

Overnight, Asia-Pacific markets traded higher after U.S. President Donald Trump announced that he had completed a “massive Deal” with Japan, with a baseline tariff of 15% set on the country's exports to the United States. S&P 500 futures were little changed Tuesday evening after the announcement.

What to keep an eye on Wednesday

Earnings season is ramping up in Europe, with the latest financial reports coming from Equinor, Randstad, Thales, Lonza, Iberdrola, UniCredit, JD Weatherspoon and Moncler.

European data releases include flash consumer confidence figures.