Three pillars of the Stock Exchange to counteract debt and oil pressure
Fears over the escalation of oil and debt interest weigh on the start of September. Despite the pressure, UBS highlights three key supports that should favour further gains in European equities.
UBS analysts remain optimistic about the European stock market despite concerns over rising energy prices and interest rates. They cite three key supports: improving economy, strong corporate earnings, and reasonable valuations. The firm's analysts note that the European industry is coping with the energy shock better than expected, with the manufacturing PMI rising to 52.7 in August, its highest level since May 2022.
UBS expects earnings per share in the eurozone to grow around 15% in 2026-2027, driven by the recovery of the manufacturing sector and investments in areas such as AI, electrification, and defense. The firm recommends sectors and markets with high exposure to the cyclical recovery, including industrial, banking, and technology.
Written by urgent.news from Expansion ES's report — not a translation of it. Machine-written — may contain errors; check the original before relying on it.
