How will European margins recover?
We expect earnings to surprise on the upside in 2016 driven in large by
operating leverage and margin expansion. In this report we look at the key
drivers of this margin pick-up and some of the key beneficiaries from it.
Driver 1 – labour costs at historical lows could boost margins
Driver 2 – the fiscal drag becomes a fiscal push in 2016
Driver 3 – low producer prices point to margin expansion
--> On the sector level Construction, Autos, Transport could benefit