Heatwaves Fail to Dampen European Stock Market Records

European heatwaves are pummeling various industries such as agriculture and tourism, but stock markets continue to hit all-time highs.

Earnings season has been strong, with inflation in Iran being a top concern, making climate change risks seem secondary.

'The biggest risk for European equities is potentially stagflationary: climate change could simultaneously weaken productivity and growth, at the same time pushing food, energy, insurance costs, infrastructure spending, and ultimately inflation structurally higher,' said Ipek Ozkardeskaya, senior analyst at Swissquote.

The Paris, Frankfurt, Madrid, and Milan exchanges all hit records in August. Even though Europe's problems have worsened with this summer's abnormally hot temperatures, earnings expectations for Stoxx 600 companies keep rising.