UBS cuts year-end target for European shares by 8%
[LONDON] Swiss bank UBS has cut its year-end target for a leading European equity index by eight per cent, mainly due to the prospect of slightly weaker economic growth and lower earnings growth.
UBS reduced its year-end target for the pan-European STOXX 600 index to 400 points from 435 points, although this would still represent an expectation of the STOXX 600 rising 21 per cent from now until the end of 2016.
UBS also cut its forecast for eurozone GDP (gross domestic product) to 1.6 per cent from 1.8 per cent for this year, and down to 1.7 per cent from 1.8 per cent for 2017, partly due to the impact of low oil prices and tighter credit market conditions.
"As a result of the GDP downgrade and the mark-to-market on the lower commodity prices, we reduce our 2016 EPS growth forecast from 13 per cent to 8 per cent - still above consensus of 4 per cent," UBS added in a note on Thursday.
REUTERS
KEYWORDS IN THIS ARTICLE
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Banking & Finance
Nomura, Mizuho face losses on All Blue fund’s failed trades
Stablecoin Tether steps up monitoring in bid to combat illicit finance
HSBC asked by US$890 billion investor group to set energy goal
Barclays is the latest firm to face anti-ESG wrath in Oklahoma
Barclays prices mortgage-backed notes in deal with GoldenTree
TD risks an earnings hit from US laundering probe, analysts say