Profits of companies from the DAX index will grow faster than those from the S&P 500 in 2026


06/09/2025

Analysts forecast that the earnings of major German firms will increase more rapidly than those of US firms next year, driven by the stimulus efforts of the German government.



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Profits for firms in the DAX stock index are projected to increase by 13-15% in the latter half of this year and continuing into 2026, bouncing back from a 2% decline in the first half of this year, as per data gathered by Bloomberg Intelligence. In the meantime, the projected earnings growth for firms in the S&P 500 for the upcoming year is 13.5 percent. 

The optimistic forecast for corporate earnings is mainly fueled by defense firms as Europe increases its budget to bolster its military. Rheinmetall, Airbus, and MTU Aero Engines are anticipated to provide approximately 20% growth in earnings per share for the DAX during the latter half of the year. 

Additional growth catalysts are expected to include firms connected to AI, electric vehicle production, and the shift towards renewable energy. 

The DAX has risen 22 percent since the beginning of 2025. This represents the greatest increase among the principal stock indices. The Stoxx Europe 600 composite rose by less than 9 percent, while the S&P 500 increased by only 1 percent. Two other significant US indices, the Dow Jones Industrial Average and the Nasdaq Composite, are experiencing declines.

source: bloomberg.com