The outlook for European companies has slightly improved, the latest LSEG forecasts showed yesterday, as energy majors are expected to deliver a big jump in third-quarter profit and investors digest a mixed bag of results.
Companies on Europe’s benchmark STOXX 600 index are expected to report quarterly earnings growth of 21.9 per cent on average, the second-best growth rate in the past four years, the LSEG report showed, based on results from 47 companies and market estimates for those that are yet to report.
That is an improvement compared to last week’s 20.7pc forecast.
Energy majors are outliers as their trading desks profit from the volatility and disruption set off by the US-Iran war and are seen posting earnings 134.1pc higher compared to a year earlier.
Excluding the energy sector, the rest of the companies in the STOXX 600 index are expected to book considerably more moderate gains, at 8.4pc, on average.
The outlook for European blue-chip companies’ third-quarter revenue has also improved and is now seen growing at 13.3pc from a year ago, which would mark the best showing since the third quarter of 2022.
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