Goldman Sachs has lowered its 12-month forecast for Europe's STOXX 600 index, citing weaker economic growth, higher tariffs, and global trade disruptions.

Key Forecast Revisions

📉 Revised STOXX 600 Price Targets:

• 3-Month: 510 (from 560) → -6% return

• 6-Month: 530 (from 570) → -2% return

• 12-Month: 570 (from 580) → 5% return

🔻 Earnings Growth Outlook Trimmed

• 2025 EPS Growth: 2% (previously 4%)

• 2026 EPS Growth: 4% (previously 6%)

• Below consensus estimates of 6% (2025) and 11% (2026)

Consensus expectations for 2025 EPS growth have already fallen from 8% earlier this year, reflecting a broader downward earnings trend.

Why the Downgrade?

🚨 Trade War Risks Intensify

• US to impose 15% reciprocal tariffs on all trading partners (previously expected at 10%).

• EU accounts for ~15% of US imports, with machinery, pharmaceuticals, and chemicals set to suffer.

📉 Weaker Global Growth

• Goldman Sachs cuts US Q4 2025 GDP forecast to 1% (from 1.5%).

• Tariffs could slow European growth, hurting corporate earnings.

Tracking STOXX 600 & Market Risks

📊 Key APIs to Monitor Market Trends:

• Sector P/E Ratio API
  Assess how valuation shifts impact key European sectors like manufacturing, pharma, and chemicals.

• Earnings Historical API
  Track European earnings trends and compare them with market expectations.

What's Next for European Markets?

🔸 Will European stocks rebound, or is further downside ahead?
🔸 How will tariff escalations impact earnings beyond 2025?
🔸 Could Europe's central banks step in to offset economic headwinds?

💡 Stay informed as STOXX 600 reacts to shifting economic conditions!