On November 5, UBS said that the third quarter earnings performance of European companies further confirmed the profit recovery trend, and there is a possibility that the profit growth of Eurozone and UK companies in 2026 will exceed the bank's expectations. Matthew Gilman, head of European stock strategy at UBS, pointed out that at present, more than half of European companies have released financial reports. Overall profit increased by about 24% year on year, and increased by about 10% after excluding the energy industry. The proportion of companies whose performance exceeds expectations is also higher than the historical average. UBS pointed out that European companies' revenue growth is accelerating, profit margins continue to improve, and profit expectations are rising more than normal seasonal levels. Investments in AI, electrification, and defense are still the main drivers of growth, but the recovery has begun to spread to more industries, and sales of some companies have improved after several years of weakness. The bank believes that profit growth in Europe is shifting from being dependent on a few industries to being supported by structural investment demand and traditional business recovery. In terms of investment opportunities, UBS is more optimistic about cyclical industries. Since mid-June, European cyclical stocks have lagged 17% behind defensive stocks, but their profit prospects are still steady, and UBS believes that most of the relative decline in the cyclical sector may have already occurred. The bank focuses on banking, information technology, industry, optional consumer and healthcare industries, while favoring the German market, European industry leaders, and Swiss medium-sized enterprises. However, UBS cautioned that although European companies' profit growth prospects have improved, higher discount rate assumptions may offset some of the driving effects of profit growth on stock indexes. Therefore, the overall room for growth in the European stock market may not be exactly in line with the increase in corporate profits.

On November 5, UBS said that the third quarter earnings performance of European companies further confirmed the profit recovery trend, and there is a possibility that the profit growth of Eurozone and UK companies in 2026 will exceed the bank's expectations. Matthew Gilman, head of European stock strategy at UBS, pointed out that at present, more than half of European companies have released financial reports. Overall profit increased by about 24% year on year, and increased by about 10% after excluding the energy industry. The proportion of companies whose performance exceeds expectations is also higher than the historical average. UBS pointed out that European companies' revenue growth is accelerating, profit margins continue to improve, and profit expectations are rising more than normal seasonal levels. Investments in AI, electrification, and defense are still the main drivers of growth, but the recovery has begun to spread to more industries, and sales of some companies have improved after several years of weakness. The bank believes that profit growth in Europe is shifting from being dependent on a few industries to being supported by structural investment demand and traditional business recovery. In terms of investment opportunities, UBS is more optimistic about cyclical industries. Since mid-June, European cyclical stocks have lagged 17% behind defensive stocks, but their profit prospects are still steady, and UBS believes that most of the relative decline in the cyclical sector may have already occurred. The bank focuses on banking, information technology, industry, optional consumer and healthcare industries, while favoring the German market, European industry leaders, and Swiss medium-sized enterprises. However, UBS cautioned that although European companies' profit growth prospects have improved, higher discount rate assumptions may offset some of the driving effects of profit growth on stock indexes. Therefore, the overall room for growth in the European stock market may not be exactly in line with the increase in corporate profits.