Jul 23, 2026 · 7 min
European stocks diverge as STMicroelectronics slumps and Dassault Aviation surges
STMicro Slumps, Dassault Aviation Up, Nestle Down
This episode highlights the widening performance gap between struggling consumer and tech giants and thriving defense contractors in Europe.
- 1STMicroelectronics shares slumped following a disappointing sales outlook that cooled high tech sector expectations.
- 2Nestle shares dropped after weak volume growth signaled mounting challenges for major consumer goods brands.
- 3Dassault Aviation shares jumped up to eleven percent on strong first-half defense sector revenue.
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Dassault Aviation shares surged up to eleven percent on exceptionally strong first-half defense revenue.
The brief
European markets are experiencing sharp divergence as corporate earnings reports expose deep vulnerabilities in consumer goods and technology, while defense sectors continue to rally on robust government spending.
STMicroelectronics slumped after issuing a disappointing sales outlook, signaling that the high expectations surrounding the global semiconductor and tech sectors may be outpacing near-term market realities.
Nestle faces its own hurdles as weak volume growth drags down its share price, raising urgent questions about pricing power and consumer demand for major global brands in an inflationary environment.
Bucking the downward trend, Dassault Aviation saw its shares surge up to eleven percent, propelled by exceptionally strong first-half revenue within its defense division.
What was said on this episode
11 statements · 6 positive · 5 negative
STMicroelectronics expects 2026 datacenter revenue above $1 billion.
“it expects datacenter revenue to be above $1 billion for 2026”
Listen at 1:16
STMicroelectronics’ weakness is probably attributable to automotive and consumer-electronics markets.
“the weakness can probably be attributed to weakness in other end markets and namely the automotive end market and then the consumer electronics end market as well”
Listen at 1:44
Recovery in automotive and consumer electronics is taking longer than expected.
“recovery is taking a little bit longer than expected”
Listen at 1:56
Rising military spending is boosting European defense companies.
“this is really an example of this hu rise in military spending, really boosting those defence companies”
Listen at 3:02
NATO allies have committed at least $50 billion to defense-industry deals.
“NATO allies have committed to at least $50 billion in defense industry deals”
Listen at 3:10
Several European governments have raised armed-forces budgets.
“Several governments across Europe have already raised budgets for armed forces”
Listen at 3:15
Higher defense spending is translating into defense orders and an upbeat outlook.
“we can see some of that momentum starting to translate into orders and into a very upbeat outlook as well”
Listen at 3:20
Nestlé’s volume growth is disappointing.
“Nestle's volume growth was seen as quite disappointing”
Listen at 3:32
Nestlé’s weak volume growth may signal trouble for Unilever and peers.
“that might not bode very well for other consumer goods companies like Unilever”
Listen at 3:37
The Iran-war inflation is increasing input costs for consumer-goods companies.
“It means higher input costs as well”
Listen at 3:48
Nestlé’s streamlined business model may improve performance.
“the CEO will be really hoping that this more streamlined business model is going to be able to translate into a better performance”
Listen at 4:27
Statements are attributed to the speaker as said on the episode and reflect their view at the time, not PodLume's. They are not advice.
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Mentioned
STMicroelectronics
NestléListen to the full episode and explore every guest, topic, and moment on PodLume.