Deutsche Bank lifts FTSE 100 earnings outlook. Here’s what’s driving the optimism

Deutsche Bank turned more constructive on the FTSE 100, lifting its FY26 earnings growth forecast to 12% from 9% on expectations of stronger Energy profits and better-than-feared growth across non-energy sectors. The bank now sees H1 aggregate FTSE 100 earnings rising 10% year over year, with Energy contributing about 7 percentage points, while ex-Energy earnings are projected to grow 5%, slightly ahead of consensus. Basic Materials is also expected to be a notable tailwind, while Financials and Staples may weigh on growth. Overall, Deutsche Bank said the macro backdrop has been more resilient than feared, supported by upside in UK growth and expansionary global PMIs. The note is broadly positive for UK large caps, although the bank remains slightly cautious versus consensus on overall FY26 growth. It also said political reforms under new Prime Minister Andy Burnham are unlikely to materially change earnings estimates.