Earnings results midway through the current reporting season starkly delineate the resilience of the US economy against the backdrop of a technical recession in the UK and stagnation in key Eurozone economies.
GDP figures last week confirmed the UK entered a technical recession in the third quarter of 2023, while the Eurozone narrowly avoided it, in contrast with the US, where activity has been resilient to the rate-hike cycle amid growing confidence in a ‘soft landing’ scenario.
This divergence is reflected in corporate performances, with US companies enjoying a +3.7% revenue growth and a +5.1% increase in earnings in the fourth quarter, contrasting with Europe’s revenues falling 6.5% and earnings 11%, according to Bloomberg data analysts by broker Liberum.
This weakness was broadly expected, with analysts having busily downgraded forecasts for many companies following a disappointing third quarter for Europe when sales…
