Europe's corporate profit expectations plunge further

FILE PHOTO: The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, April 21, 2020. REUTERS/Staff/File Photo

LONDON (Reuters) - Europe Inc’s profit expectations for the second and third quarters continued to deteriorate sharply, Refinitiv data showed on Wednesday, as fears about the scale of the recession triggered by the coronavirus outbreak continue to grow.

Companies listed on the pan-European STOXX 600 .STOXX are now expected to report a 37% decline in earnings in the second quarter, down from a 34.2% drop forecast the week before.

For the third quarter, analyst expectations are now set for a 27.6% fall in earnings versus 25.5% a week ago.

While many governments in Europe are looking into strategies to gradually ease lockdowns implemented to fight the epidemic, there is currently little visibility as to when the economy could return to normal.

Before the virus outbreak, analysts were expecting Europe to end its corporate recession, which lasted throughout 2019, but those hopes have since been quashed.

Julien Ponthus, editing by Louise Heavens