European Corporate Health Faces Strain Amid Geopolitical Tensions

European corporate health has slightly worsened due to geopolitical tensions outweighing U.S. tariff relief. Forecasts show a 4.2% drop in fourth-quarter earnings for 2025, marking the worst performance in seven quarters. Despite some stock market gains, revenue projections are also declining, raising concerns about Western alliances.

European corporate health has taken a hit, with forecasts released on Thursday indicating a more challenging outlook. Relief expected from U.S. tariffs is overshadowed by ongoing geopolitical tensions, affecting traditional Western alliances.

The latest data from LSEG I/B/E/S predicts a 4.2% drop in fourth-quarter earnings for 2025, worse than the 4.1% decline analysts had foreseen just last week. This would be the worst performance in seven quarters.

Even though European stocks received a temporary boost following U.S. President Donald Trump's decision not to impose tariffs on certain European allies, concerns linger. As revenues are projected to shrink by 3.5% compared to last year, experts warn of potential volatility in foreign policy.

(With inputs from agencies.)