economy
Europe’s Earnings Are Poised for Double-Digit Growth. One Sector Will Do the Heavy Lifting, Says Deutsche
Second-quarter European earnings are set for double-digit growth on the same period last year, but gains will be led by one sector in particular.
TL;DR
- Second-quarter European earnings are expected to grow 12% year-on-year.
- The energy sector is forecast to see an 84% year-on-year earnings increase.
- High oil prices, averaging $97 per barrel in Q2 due to the Iran war and Strait of Hormuz closure, are the cause of energy sector growth.
- Excluding energy, European earnings growth is estimated at only 3%.
- Chemicals and industrials are also expected to show strong growth.
- Bank earnings growth is decelerating, while auto earnings are projected to turn positive.
- Healthcare is likely to experience its third consecutive quarter of declining earnings.