Markets, Business & Tech Briefing: PSI Edges Up 0.3%, Galp Leads as Navigator Slides, 10-Year Yield Near 3.5%

Portuguese Equities

Lisbon opened the week with a quiet gain. The benchmark PSI index added about 0.3% on Monday, 13 July, rising roughly 27 points to close near 9,134 — a steady start after a softer first half of the month that had left the index camped in the low-9,100s. The move keeps the PSI up close to 1% over the past month and around 18.5% higher than a year ago, a reminder that Lisbon remains one of Europe's stronger performers even as summer volumes thin and daily ranges narrow. Advancing utilities, energy and telecoms did most of the lifting, offset by a sharp pull-back in the paper-and-pulp names.

Blue-Chip Movers

Energy group Galp Energia led the large caps, firming about 1.5% to around €19.86 as investors leaned back into the sector (more below). Telecoms operator NOS gained close to 1.2% to about €4.97 and utility EDP added roughly 1% to €4.51, while the country's largest listed bank, Banco Comercial Português (BCP), was little changed at about €1.04 and retail heavyweight Jerónimo Martins edged up around 0.5% to €16.46 ahead of results season. The day's clear laggard was The Navigator Company, the pulp-and-paper maker, which slid about 3.7% to roughly €3.15 amid soft European paper prices; peer Semapa eased around 1.2% to €20.40 and postal operator CTT — Correios de Portugal (CTT — Post Office of Portugal) gave back about 1.3%. Construction group Mota-Engil was broadly flat near €4.51.

Government Bonds

Portuguese sovereign debt sold off modestly in line with the wider euro area. The yield on the 10-year Obrigações do Tesouro (Treasury bonds) rose about 5 basis points to roughly 3.46%, its highest in more than two years, as investors trimmed bets on near-term European Central Bank easing. Crucially for Portugal, the equivalent German Bund (the euro area's benchmark safe asset) yield climbed by a similar margin to about 3.09%, leaving the spread between the two at roughly 37 basis points — still historically tight and close to the narrowest levels since before the sovereign-debt crisis, a mark of how far the country's credit standing has recovered.

Euro and the Dollar

The euro drifted lower against the dollar, with EUR/USD easing about 0.2% to around $1.14. The single currency has now shed close to 1.7% over the past month as firmer United States data and a cautious Federal Reserve keep the greenback supported. For Portugal's exporters and its tourism trade, a softer euro is a modest tailwind heading into the peak summer weeks.

Corporate Focus: Galp and the Sines Refinery

Galp's advance came as the future of its Sines refinery moved back into focus. The government has been pressing Spain's Moeve and Galp to lock in binding long-term investment commitments for the plant as a condition of the planned merger of their refining operations — a deal, agreed in January, that folds Galp's refining into a larger venture controlled by the Carlyle Group and its co-investors, with Galp retaining a minority stake of about 20%. Combining Moeve's three Spanish refineries with Sines would create the European Union's largest refining group, processing some 700,000 barrels a day, with all the hubs steered gradually toward biofuels and green hydrogen. Galp is separately ploughing about €400 million, alongside Japan's Mitsui, into a Sines unit that will turn vegetable oils and waste fats into sustainable aviation fuel and renewable diesel.

Deal Watch: Mota-Engil's Congo Rail Mandate

Portugal's biggest construction group added to its international pipeline. The Democratic Republic of Congo has tapped Mota-Engil to help revive the copper-and-cobalt rail link on the Congolese stretch of the United States-backed Lobito Corridor, under a public-private partnership endorsed by Kinshasa that envisages a complete rehabilitation of the line. It is a separate mandate from the roughly €185 million of Mexican urban-mobility contracts the group booked earlier this month, and it deepens Mota-Engil's exposure to the mineral-logistics corridors that Western governments are racing to secure. The shares, already among the PSI's stronger performers this year, were little moved on the day.

The Week Ahead

Expect a slow, earnings-led week. Portugal's blue chips begin reporting first-half and second-quarter results over the coming weeks — Jerónimo Martins typically opens the season in late July, followed by the banks and utilities into early August — and those numbers, rather than the macro calendar, should set Lisbon's direction. In the meantime, thin summer liquidity can exaggerate moves in either direction; the standouts to watch are the 10-year yield now that it has pushed to a multi-year high near 3.46%, the Brent crude price for Galp, and United States inflation data for the euro-dollar rate. Tuesday's tone will likely be dictated by the European open and any read-through from oil.