Asian Currencies Steady as Rupee Hits Record Low Amid Fed Rate Cut Bets 
Asian Markets Mixed as RBI Cuts Rates and BOJ Signals Possible Hike 
IMF Deputy Dan Katz Visits China as Key Economic Review Nears 
Gold Prices Edge Higher as Markets Await Key U.S. PCE Inflation Data 
Dollar Holds Steady as Markets Shift Focus to 2026 Rate Cut Expectations 
European Stocks Rise as Markets Await Key U.S. Inflation Data 
Germany’s Economic Recovery Slows as Trade Tensions and Rising Costs Weigh on Growth 
Japan’s Nikkei Drops as Markets Await Key U.S. Inflation Data 
Asian Currencies Edge Higher as Markets Look to Fed Rate Cut; Rupee Steadies Near Record Lows 
China’s Services Sector Posts Slowest Growth in Five Months as Demand Softens 
BOJ Governor Ueda Highlights Uncertainty Over Future Interest Rate Hikes 
Oil Prices Rise as Ukraine Targets Russian Energy Infrastructure 
Dollar Slides to Five-Week Low as Asian Stocks Struggle and Markets Bet on Fed Rate Cut 
Gold Prices Steady as Markets Await Key U.S. Data and Expected Fed Rate Cut 
Asian Markets Mixed as Fed Rate Cut Bets Grow and Japan’s Nikkei Leads Gains 
UBS has raised its outlook on European equities ahead of the second-quarter earnings season, highlighting potential upside in select company results despite muted regional forecasts. The bank’s European Equity Strategy update notes that Q2 earnings growth is expected to remain subdued, with full-year 2025 projections trimmed to just 2%. This cautious stance stems from continued macro headwinds, including trade tariffs and unfavorable currency moves.
Earnings momentum in Europe has stagnated, with no significant growth recorded since 2022—continuing a broader trend of flat performance between 2010 and 2016. Nevertheless, UBS maintains a constructive medium-term view, forecasting a return to earnings growth in 2026, driven by cyclical sectors benefiting from fiscal stimulus and improved consumer spending.
In the near term, however, the spotlight is on company-specific earnings surprises and guidance. UBS analysts have conducted a cross-sector review and identified 21 companies likely to outperform expectations and 10 names that may warrant caution. These picks are based on sector forecasts and crowding data from UBS Quant Research, which gauges investor positioning intensity.
UBS notes that even modest earnings beats or reaffirmed guidance could trigger positive stock reactions given the low expectations heading into the quarter. Commentary that offers insight into 2026 performance is expected to resonate well with investors.
The firm’s increased conviction stems not from a broad macro recovery but from differentiated earnings dynamics at the company level. As valuations across the region remain selectively attractive, the Q2 earnings season is poised to be a critical test for the “Case for Europe.” UBS believes companies showing cost discipline, resilience, or sector-specific strength could emerge as key outperformers in an otherwise cautious environment.
