--- title: "Breaking Two Years of Silence! Analysts Raise European Stock Earnings Forecasts for 10 Consecutive Weeks, Fastest Pace Since 2024" type: "News" locale: "en" url: "https://longbridge.com/en/news/292330966.md" description: "The foundation for the rebound in European stocks is solidifying. Net upward revisions to corporate earnings expectations have persisted for ten consecutive weeks, reversing a nearly two-year trend of continuous downward adjustments. Bloomberg projects second-quarter earnings growth to reach 12%, a three-year high. Although some institutions remain cautious about the sustainability of these expectations and warn of the risk that actual earnings may fall short, some asset managers believe that the inflation environment and AI penetration are providing structural support for European companies that has not yet been fully priced in" datetime: "2026-07-10T14:04:12.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/292330966.md) - [en](https://longbridge.com/en/news/292330966.md) - [zh-HK](https://longbridge.com/zh-HK/news/292330966.md) --- # Breaking Two Years of Silence! Analysts Raise European Stock Earnings Forecasts for 10 Consecutive Weeks, Fastest Pace Since 2024 The rise in European stocks is gaining new fundamental support. After nearly two years of continuous downward revisions to earnings expectations, the outlook for European corporate earnings has shown significant improvement. Citigroup’s earnings expectation revision indicator shows that **the number of times analysts have raised earnings forecasts for European companies has exceeded downward revisions for the tenth consecutive week, marking the longest streak of net upward revisions in nearly two years.** Meanwhile, Bloomberg Intelligence expects that **European corporate earnings will grow by 12% year-over-year in the second quarter of this year, the fastest growth rate in more than three years.** The improvement in earnings expectations has also prompted institutions to further raise their targets. Morgan Stanley has raised its forecast for the MSCI Europe Index’s 2026 earnings growth to 12.5% and expects the index to have approximately 10% upside potential over the next 12 months. Capital flows are also warming up; as of the week ending July 8, **European equity funds recorded net inflows of approximately $400 million, indicating that global capital is refocusing on European assets.** ## **Earnings Expectations Rise for Ten Consecutive Weeks; The Foundation of the European Stock Rebound Remains to Be Tested** After nearly two years of almost uninterrupted downward adjustments, the direction of revisions to European corporate earnings expectations has undergone a substantive reversal. According to Citigroup’s statistics based on Bloomberg data, European earnings expectations have seen net upward revisions for ten consecutive weeks, setting the longest consecutive rise record since mid-2024. However, Bloomberg also warns that a similar upward trend two years ago came to an abrupt halt just weeks before the start of the earnings season and quickly turned downward. This precedent has led the market to question the sustainability of the current trend. More critically, the expectations themselves are becoming a source of risk. **Market pricing for earnings growth is currently at a high level; if actual earnings reports fail to meet expectations, the pressure for stock price corrections will amplify.** From an industry structure perspective, the energy sector benefits from oil prices maintaining relatively high levels, which is expected to support profits; the banking sector is viewed as an early beneficiary of the wave of AI applications in Europe, with earnings resilience expected to continue. Marina Zavolock, a fund manager at asset management firm Natalia Milovets, believes that the market has systematically misjudged European corporate earnings. **“The inflation environment, AI penetration, and diversified global revenue layouts are jointly constituting structural support for European corporate earnings,” she stated. “These factors have not been fully priced in, leaving room for further upside in European stocks.”** In terms of market performance, after underperforming US stocks continuously since March of this year, the STOXX Europe 600 Index surpassed the S&P 500 Index last month. One of the catalysts behind this was the temporary peace agreement between the US and Iran, which briefly eased geopolitical risk premiums; although geopolitical risks have heated up again recently, current oil price levels remain significantly lower than during the peak of the conflict. Helen Jewell, Chief Investment Officer of Fundamental Equities International at BlackRock, pointed out: **“Europe is currently more suitable as a diversification tool within portfolios. AI-themed holdings are highly concentrated, while the industry breadth of the European market can effectively hedge against such crowding risks. 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