European firms, "optimistic" for 2026 - Businesses report less uncertainty after trade agreements
European companies are leaving behind the uncertainties that dominated most of 2025 and are turning their attention to 2026, which looks much more promising.
According to a Bloomberg analysis, companies have talked much less about "uncertainty" during earnings calls in the third quarter, compared to the average over the past five years.
Overall, firms defied pessimistic expectations for the third quarter, weathering tariffs and currency fluctuations and reporting stronger-than-expected margins. Clearer trade policies also played a role, helping businesses gain more confidence in their cost and profit forecasts.
“The overall situation has become more positive, with discussions about supply chains, inflation and recovery becoming increasingly optimistic,” the analysts explain.
Over the summer, the US and the European Union reached a trade deal for a 15% tariff, while some companies negotiated separate deals with the US administration. Switzerland, the developed economy hit hardest by the tariffs, also reached a preliminary agreement with Donald Trump to reduce the duty from 39% to 15%.
However, some sectors are still suffering from trade tensions. Representatives of Hexpol AB, a manufacturer of rubber and plastic components for the automotive and construction industries, noted that “high uncertainty continues, driven by US tariffs and US trade policy. This is indirectly affecting us, hurting customers in North America and dampening demand,” they said.
Now the pressure is more concentrated in a few sectors, which has increased confidence in a recovery next year. This situation has also led to an increase in estimates for 2026.
Although some sectors, such as automotive and chemicals, continue to be under pressure, “the stability of margins in cyclical and defensive industries creates a stronger earnings foundation for 2026,” the analysts explain.
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