Markets, Business & Tech Briefing: Lisbon Closes Higher Against a Falling Europe, the 33 Percent Oil Levy Reaches Parliament, the State's REN Mandate Runs to 20 Percent

Every major European index fell on Tuesday except one. The PSI closed up 0.71 percent while the Stoxx 600 lost 0.66 percent, and it did so on a day when the two forces pushing the rest of the continent down, rising sovereign yields and rising crude, happen to favour the companies that dominate Lisbon. Portugal's index is heavy in oil, in construction and in regulated networks. When energy goes up, Lisbon is on the right side of it.

Lisbon Was the Only Major European Market to Close Higher, and It Took Back Half of Monday

The PSI finished at 9,446.63 points, up 66.33 points or 0.71 percent from Monday's close of 9,380.30. Fourteen of the sixteen constituents rose. The index opened at 9,343.77, fell to 9,310.78 at 08:42, and spent the rest of the session climbing to a high of 9,449.15 at 16:35, two minutes before the close. From that morning low to the finish is 135.85 points, or 1.46 percent.

That needs Monday alongside it to read properly. No markets briefing ran yesterday, so here is the session it is recovering from: the PSI fell 144.43 points on Monday, from Friday's 9,524.73 to 9,380.30, a drop of 1.52 percent that took the index off the doorstep of its 52-week high. Today gives back 66.33 of those points, a little under half. The 52-week high of 9,550.72 now sits 104.09 points away, or 1.09 percent.

Around Lisbon, the tape was uniformly red. The Stoxx 600 lost 0.66 percent, Britain's FTSE 100 fell 0.43 percent, France's CAC 40 lost 0.23 percent, Germany's DAX 40 slipped 0.13 percent and Spain's IBEX 35 ended almost flat at minus 0.04 percent. These are the closing prices Lisbon carries into Wednesday, taken from Euronext's own list page and stamped between 16:35 and 16:38 WEST.

Mota-Engil took the biggest single gain at 2 percent, with its smaller rival Teixeira Duarte third at 1.68 percent. Both had opened lower: Teixeira Duarte was down 1.89 percent in the first minutes of trading and Mota-Engil more than 1.5 percent, so the construction pair turned round completely during the day. BCP was the only faller besides Ibersol, and at minus 0.08 percent it barely qualifies; Jornal de Negócios (Business Journal) attributes that to weakness across European banking rather than anything at the bank itself, which is worth noting because a Mediobanca analyst raised the BCP target price this morning.

Galp Led the Heavyweights on the Day a Bill to Tax Its Excess Profits at 33 Percent Reached Parliament

Galp rose 1.95 percent to 21.97 euros, the largest gain among the index's heavyweights, on the same afternoon the government delivered to parliament the law that will tax the sector's windfall profits. The two facts are not in tension: crude was up nearly 2.5 percent, and the levy has been public since the Council of Ministers approved it in late July. We covered the approval on 3 August. What arrived today is the text, and the text has detail the announcement did not.

The instrument is called the Contribuição de Solidariedade Temporária sobre o Setor Petrolífero (Temporary Solidarity Contribution on the Oil Sector), or CSTSP. It applies at 33 percent, it applies only to the 2026 tax year, and it bites on the portion of taxable profit that exceeds by more than 20 percent the average of the company's taxable profits in 2024 and 2025. Profits below that threshold are untouched.

Three provisions in the bill matter more than the headline rate. First, refining is measured differently: where a refiner's own cost accounting produces a lower taxable profit than the First In First Out method would have produced on the crude it consumed, the positive difference is added back before the levy is applied. That closes the gap between inventory accounting and the cash the refining margin actually generated, and it is aimed squarely at the only refinery in the country. Second, where a company's 2024 to 2025 average was negative, the average counts as zero and the contribution falls on the whole of the 2026 taxable profit. Third, the revenue is ring-fenced: it goes by ministerial order to the Fundo Ambiental (Environmental Fund) and the Instituto de Financiamento da Agricultura e Pescas (Institute for the Financing of Agriculture and Fisheries), and may fund only measures adopted after 28 February to support final consumers of fossil fuels, in particular households, volunteer fire brigade associations and social-sector bodies, plus financial support to freight and public-service passenger transport operators.

The government's own justification, in the preamble, is that the excess margins in extraction and refining "do not derive from improvements in productive efficiency, from innovative strategic decisions or from new structural investment by the operators, deriving solely from exogenous market fluctuations". Parliament has yet to consider the bill. The European Commission cleared the underlying request in April, from Portugal's finance minister Joaquim Miranda Sarmento and his German, Spanish, Italian and Austrian counterparts, but ruled that any such tax would be a national decision rather than an EU one. The question of what this does to the Galp and Moeve downstream deal, where Sines is already the contested asset, is not addressed anywhere in the text.

A Halted Saudi Pipeline Is Still Setting the Oil Price, and Brent Added Another 2.44 Percent

Brent rose 2.44 percent on Tuesday to 108.25 dollars a barrel, and West Texas Intermediate rose 3.94 percent to 105.39, on TradingEconomics' series. Brent is up 19.13 percent over the past month and 58.10 percent on the year. We set out this morning what started the move: Saudi Arabia shut a pipeline that serves as an alternative route to the Strait of Hormuz, and Oman postponed the meeting at which Iran and the Gulf states were to discuss the strait.

The new detail today is the size of what is offline. The pipeline is the East-West line, the infrastructure that lets Saudi crude reach the Red Sea without passing through Hormuz, and it is stopped following drone strikes on the installation. Jornal de Negócios puts the volume at risk at up to five million barrels a day, roughly 5 percent of world supply, and notes that the duration of the shutdown remains unknown; how long it lasts is the variable that decides how far crude can run. Qatar warned separately on Tuesday that a blockade of the Bab el-Mandeb strait would be "catastrophic" for the world, which is the other chokepoint on the same journey.

Portugal Holds 3.92 Percent While the American Ten-Year Trades Above 5 for the First Time Since 2007

Portugal's ten-year yield held steady at 3.92 percent on Tuesday, which in a sovereign sell-off is the good outcome. The German Bund sits at 3.53 percent, so the spread Portugal pays over Germany is 39 basis points. Spain rose three basis points to 4.01 percent and has now held above 4 for a second session, nine basis points wide of Portugal. Greece added one point to 4.30, Italy two points to 4.42 and France was unchanged at 4.50. Portugal is inside all four: 38 basis points inside Greece, 50 inside Italy and 58 inside France. Those four gaps are computed here from the six quoted levels, all stamped 15 September.

The pressure is coming from outside the euro area. The United States ten-year Treasury yield traded above 5 percent again on Tuesday, touching 5.033 percent during the morning on Refinitiv data, the highest level since 2007. It crossed 5 on Monday for the first time since June 2007. German two-year and five-year yields hit their own highs since 2013 and 2014 respectively. The sell-off is being fed by two things at once: the fear that oil keeps inflation stuck, and the weight of government debt issuance. Wall Street opened lower on the back of it, with the S&P 500 down 0.10 percent, the Nasdaq down 0.18 percent and the Dow Jones down 0.23 percent in early trading.

Portugal comes to market in the middle of this. The IGCP, the Portuguese debt agency, confirmed in its own announcement of 11 September that it will auction a single Treasury bill line on Wednesday 16 September at 10:30 Lisbon time (11:30 CET): BT 17SEP2027, twelve-month paper, with an indicative range of 1,000 million to 1,250 million euros. It is short-dated and it is small, so it is a temperature reading rather than a test, but it is the first Portuguese paper priced since the American ten-year went through 5.

The Euribor Rose Again, and the Euro Fell for a Third Session

All three Euribor maturities rose again on Tuesday, though nothing like Monday's jump. The six-month rate, the benchmark on most Portuguese variable-rate mortgages since January 2024, was fixed at 2.946 percent, up 0.010 points and a fresh high since October 2024. The twelve-month rose 0.014 points to 3.326 percent, its highest since August 2024. The three-month added 0.018 points to 2.682 percent. Monday's moves were 0.116 and 0.152 points on the six and twelve month rates; today's are a tenth of that, which is the difference between a shock and a drift, and the drift is still upwards.

The euro fell for a third consecutive session against the dollar. The European Central Bank fixed its reference rate at 1.1539 dollars on Tuesday, against 1.1551 on Monday and 1.1592 last Friday, a cumulative decline of about 0.46 percent across the three days. Against sterling the euro was almost unchanged at 0.85580 pounds, from 0.85598 on Monday, though that is still down from 0.85815 on Friday. A weaker euro raises the euro cost of a barrel priced in dollars, which is the mechanism by which all of the above arrives at a Portuguese pump.

One number ran the other way. The euro area posted a trade surplus of 14.2 billion euros with the rest of the world in July, Eurostat reported on Tuesday, an improvement of 3.5 billion on the 10.7 billion of July 2025, with exports up 9 percent to 276 billion and imports up 7.9 percent to 261.8 billion. The cumulative picture is much worse: for January to July the surplus collapsed to 17 billion euros, against 92.8 billion in the same period of 2025, because imports over those seven months grew 5.8 percent while exports grew 1.2 percent. That is the energy bill, arriving in the trade account.

The State's Mandate on REN Runs to 20 Percent, Not 13.7, and the Socialists Want the File

REN rose 1.31 percent to 3.485 euros on a day when the size of the state's intentions towards it became public. We reported the completion of the 13.7 percent purchase last week. That purchase, it turns out, is described in the government's own paperwork as a first phase.

A joint order of the finance and environment and energy ministries, dated 6 July and filed with the Tribunal de Contas (Court of Auditors) as part of the prior-approval process, instructs Parpública, the state holding company, to acquire shareholdings in REN corresponding to "up to 20 percent" of its share capital. The document says the operation should be carried out in a first phase through a direct purchase from Pontegadea Inversiones, the investment vehicle of Inditex founder Amancio Ortega, of up to 13.7 percent. The order was first reported by Observador after consulting the file sent to the Court of Auditors, which cleared the transaction on 31 August; the purchase closed last week.

The strategic logic is a counterweight. State Grid, which belongs to the Chinese state, holds 25 percent of REN and is its largest shareholder. Heitor Barras Romana, a full professor of strategic studies, told ECO that at 13.7 percent, and more so at 20, "Portugal creates a national shareholder counterweight to State Grid's 25 percent", while cautioning that there is no point demonising China, because this is ordinary economic diplomacy and the job of the receiving country is simply to protect its own interests in the trade-off. Duarte Pitta Ferraz of Ivens Governance Advisors was blunter: facing State Grid's 25 percent, "the Portuguese state should never hold less than 25 percent". His summary of the principle was that economic openness does not mean strategic naivety. João Moreira Rato, president of the Instituto Português de Corporate Governance (Portuguese Corporate Governance Institute), made the narrower point that a board seat lets the state supervise execution of the concession contract from inside rather than through regulation alone.

Under the Portuguese company code the 13.7 percent stake already gives the state the right to name at least one director. Pontegadea held that right and never used it; at present only State Grid and Fidelidade have appointed directors, and State Grid secured three of fifteen in the last mandate. The energy minister, Maria da Graça Carvalho, who has called holding a stake in REN a question of sovereignty, said the board question "will be discussed in due course with the shareholders and within the government". The current board's mandate expires at the end of this year.

The opposition's objection is about price rather than strategy. The Partido Socialista (Socialist Party) deputy Marcos Perestrello said on Tuesday that the state is paying almost double what it received for its last REN stake in 2014, and that the price includes "an unjustified bonus of more than 50 million euros to the shareholder". "We live in times when there is no money for anything," he said. "To help people deal with this difficult situation the government has no money, but to spend almost 400 million euros acquiring a stake it had sold for almost half, and give a bonus of more than 50 million to the shareholder, the government has found the resources." The PS has filed a formal request for all documentation on the acquisition and, pointedly, for the list of everyone who took part in the process, so as to establish whether the government approached the shareholder or the shareholder approached the government. It also said it will table a bill in the coming weeks to tighten the rules on state asset purchases, requiring an economic and financial viability study, a technical and political justification, and at least two independent valuations, bringing acquisitions closer to the legal regime that governs privatisations.

Ibersol Turned a 1.6 Million Euro Profit Into a 40,000 Euro Loss, and Crédito Agrícola Earned 168.5 Million

Ibersol was the worst performer on the index, down 1.92 percent to 10.20 euros, in the first full session after its half-year results. The operator of KFC, Pans & Company, Pizza Hut and Taco Bell in Portugal reported a loss of 40,000 euros for the first six months, against a profit of 1.6 million in the same period last year. The number is small in absolute terms, which is precisely the point: this is a business that has crossed from black to red rather than one that has collapsed. It is also a reversal for the stock, which was the single best performer on the index on Friday at plus 4.41 percent.

Crédito Agrícola, the sixth-largest Portuguese bank by net assets and not listed, reported first-half profit of 168.5 million euros on Tuesday, down 2.2 percent, for a return on equity of 10.5 percent. Net interest income fell 1.5 percent to 328.4 million as rates normalised, and structural costs rose 8.5 percent to 254.8 million, with general administrative expenses up 15.4 percent on digital transformation and on advertising and marketing, and staff costs up 6.1 percent after 86 new hires and a pay update. The insurance arm was the other drag: the combined contribution of CA Vida and CA Seguros fell nearly 60 percent to 5.9 million on claims from the storms at the start of the year. Chief executive Sérgio Frade put the storm impact at about 50 million euros for the group, not all of it visible in the insurer's accounts because of reinsurance. Storm Kristin hit the same arm in the first quarter, when profit fell 26.1 percent, so the half-year figure represents a substantial recovery in the second three months.

Two things held the half up. Financial operations almost doubled to 22.5 million euros, mostly on gains from hedging derivatives: Frade explained that the group runs a 13 billion euro portfolio of European government debt and hedges its interest-rate risk with derivatives whose value moves with the rate cycle. And the loan book grew 8.1 percent to 14.5 billion euros, carried by mortgages, particularly young-buyer loans under the state guarantee line. By the end of June the bank had advanced 251.8 million euros of young-buyer mortgage credit across close to 1,500 contracts, drawing 36 million euros of state guarantee. Customer deposits rose more than 2 percent to 24.3 billion.

Also: Sodim Takes 81.79 Percent of Semapa, Jerónimo Martins Will Appeal Warsaw, Mediobanca Lifts BCP

Semapa rose 1.23 percent to 20.60 euros, and was one of only three risers in the opening minutes of the session, after telling the market late on Monday that two of the holding companies through which the Queiroz Pereira family controls it have merged. CIMO was absorbed into Sodim, which now holds 81.79 percent of Semapa directly. Both vehicles belonged to the same family, so this concentrates an existing control position rather than changing it, but it simplifies the chain above a company that in turn controls The Navigator Company.

Jerónimo Martins rose 0.74 percent to 17.79 euros after confirming on Monday that it will appeal the Polish competition regulator's decision. We covered the fine yesterday: 525 million zloty, which is about 120 million euros, over a no-poach arrangement affecting lorry drivers. The appeal is the company's first formal response.

And BCP, despite closing marginally lower, had its target price raised by Mediobanca's analyst on Tuesday to 1.29 euros over twelve months, from 1.18 previously. The shares closed at 1.181, so the new target implies roughly 9 percent of upside from here.

Wednesday

Two events, one domestic and one not. The IGCP auctions the twelve-month bill at 10:30, the first Portuguese paper to price since the American ten-year broke 5 percent, and the demand figure will say more than the yield. Then the Federal Reserve concludes its two-day meeting, and ECO reports that the market is pricing a 25 basis point increase; if that lands, the sovereign sell-off that dragged Europe down on Tuesday gains a further push, and Lisbon will find out whether an index weighted towards oil and networks can keep standing apart from the rest of the continent for a second day.