Market Insights February 9, 2026

Growth of US corporates remains strong

Fourth-quarter results confirm the robust momentum of the American economy. With 60% of S&P 500 companies having reported their earnings, a highly positive assessment of the final quarter of 2025 can already be drawn. Nearly 80% of these companies have exceeded consensus expectations, and by a significant margin. Reported earnings have outpaced analysts’ forecasts by almost 9%, highlighting a level of caution in projections that now appears overly conservative.

Earnings growth is expected to reach approximately 12% year-over-year, while revenues are increasing by 6%. More importantly, the contribution to this growth extends well beyond the technology sector, fostering broader sector participation in the recent stock market rally. As a result, the investor rotation out of technology and into more cyclical sectors continues, with industrials, in particular, gaining strong momentum at the start of the year.

Europe: an opportunity beyond diversification?

European equity markets are extending the positive momentum observed in 2025 and, over the past three months, have clearly outperformed both the US market and the global equity index. The recent correction in the artificial intelligence theme has further reinforced this relative advantage.

The key question is whether this momentum can be sustained. We believe it can. Europe does not face the same valuation concerns as the United States, and its far less concentrated market structure offers superior sector diversification and reduced dependence on mega-cap stocks. The largest European company represents less than half the market capitalization of the largest US company, thereby limiting vulnerability to market rotations.

Moreover, the region exhibits low correlation with other major markets, and current valuation levels, around 14.5x, have historically generated positive long-term returns. Finally, investor sentiment has returned to neutral territory, an encouraging signal that could pave the way for new all-time highs.

Beyond these structural strengths, valuation, diversification, correlation, and sentiment, the macroeconomic environment is now emerging as an additional and critical factor. A major catalyst is taking shape: monetary and fiscal policies, long moving in opposite directions, are now aligning in an expansionary stance.

The European cycle is already benefiting from the ECB’s rate-cutting cycle, which is beginning to revive real estate, construction, and domestic demand. After years of fiscal austerity that weighed on economic activity, Europe is embarking on a synchronized fiscal expansion, notably driven by substantial rearmament efforts and unprecedented investment programs in Germany, whose effects are expected to materialize from the second half of 2026 onward. At the same time, Southern European countries continue to benefit from the deployment of Next Generation EU funds, supporting investment and medium-term growth.

In an environment where expectations remain subdued, Europe thus offers significant potential for positive surprises. The stars appear to be aligned!

This week’s figure: 50’000

For the first time in its history, the Dow Jones Industrial Average has surpassed the 50’000 mark. The remarkable resilience of the US economy, together with the recent sector rotation in favour of cyclical stocks, largely explains this advance.