Nestlé, LVMH and ASML shares jump up to 10% after strong earnings

Europe’s early earnings reports have surpassed expectations, driving sharp gains in major stocks. Investor optimism is fueling hopes for a year-end rally, despite lingering concerns over tariffs and weakening margins.

Shares of Nestlé, LVMH, and ASML surged as much as 10% this week, outperforming the Stoxx Europe 600 index. Nestlé posted its biggest jump in 17 years after stronger-than-expected sales and plans to cut 16,000 jobs, while LVMH added nearly €40 billion in market value following a surprise return to sales growth. ASML also advanced as AI-driven demand for chipmaking equipment boosted sentiment around the tech sector.

According to Bloomberg Intelligence, the share of companies beating forecasts is the highest since early 2023, partly due to low market expectations. Analysts still project flat third-quarter earnings for European blue chips, but solid reports and a stabilizing political backdrop in France are supporting hopes of stronger markets heading into the final quarter.

Despite risks from tighter profit margins and a strong euro, strategists at Deutsche Bank and Lombard Odier remain upbeat. They expect Stoxx 600 company earnings to grow 11% by 2026, with investors maintaining ample liquidity to reward firms showing resilient performance.