European Stocks Seen Rising Modestly Amid Geopolitical Risks
A Reuters poll found that European shares are expected to post modest gains by the end of 2026, as geopolitical risks temper optimism from strong corporate earnings.
The pan-European STOXX 600 index is forecast to end 2026 at 670 points, up about 2% from current levels, according to the median estimate in an August 12 to 26 poll.
Earnings growth has been robust, with European companies delivering a 24.1% rise in second-quarter results, the strongest quarterly growth since the third quarter of 2022, excluding the post-pandemic recovery period.
Despite expectations that European stocks will edge to fresh highs, investors face several risks, including tighter European Central Bank policy and the threat of further energy supply disruptions linked to conflicts in the Middle East and Ukraine.