Industry Sector Weekly by Lloyds TSB

As the Q3 earnings season steam rolls ahead, European corporates continue to exceed analysts’ expectations. The ratio of companies reporting positive to negative earnings surprises currently stands at a ratio of 3:1. A week of surprises

As the Q3 earnings season steam rolls ahead, European corporates continue to exceed analysts’ expectations. The ratio of companies reporting positive to negative earnings surprises currently stands at a ratio of 3:1. Overall, in percentage terms, earnings have beat estimates by 9.96%, thanks largely to a handful of large capitalised companies in a number of key sectors. These include Volkswagen AG, Arecelormittal, Royal Dutch Shell, and Deutsche Bank, which alone has contributed to 75% of the overall share of surprises reported thus far on the Stoxx 600. While the headline strength of these corporate results should act as a confidence boost to markets, underlying concerns still remain around the fragility of the wider global economic recovery.

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