Upcoming week worldwide: Key banks and an uncertain tariffs situation

Next week, the CNBC team will be traveling again, concentrating on banks and European Central Banks, with stops in Frankfurt, Milan, Paris, and London.

The financial market appears to be optimistic about the sector’s ability to sustain positive revenue growth this quarter. Citi characterized the first quarter as “very resilient,” and analysts are eagerly anticipating results. Year-on-year revenue growth per share for the Stoxx 600 seems promising.

This optimism seems primarily focused on larger banks, while sectors like luxury goods, automobiles, and energy are experiencing revenue downgrades.

UniqueRedit will kick things off on Wednesday. Major Italian banks are trying to steer investors’ attention towards their financials instead of mergers and acquisitions ambitions. Meanwhile, analysts at Saxo Bank have noted that Commerzbank’s stock has surged by 20%, even as there’s uncertainty surrounding its potential acquisition. Banco BPM has seen its stock price increase by over 50% this year, especially since an Italian court has stalled any movement pending further conditions. CEO Andrea Orcel is looking to advance with expansion plans.

In France, BNP Paribas, the leading lender in the Eurozone, is set to announce revenues on Thursday. Last quarter, banks exceeded expectations due to strong performances in investment banking, though profitability goals came in slightly lower.

On the same day, focus will also turn to Frankfurt. German banks reported their highest profits in 14 years, thanks to increased trading activity amidst market volatility. CEO Christian Sewing noted opportunities for growth in Europe’s defense sector back in June.

This week’s focus for macro analysts will be on the European Central Bank. President Christine Lagarde and her team are expected to maintain interest rates at 2% on Thursday. Yet, there’s a notable catch…

Reports suggest that the tariff threats from U.S. President Donald Trump shouldn’t disrupt the meeting. However, if Trump goes ahead with 30% tariffs on EU imports, there’s a prevailing belief that the ECB would respond by cutting rates.

Investors will need to gauge the possible fallout until September 11th, as the ECB goes on summer break after this week’s meeting.

On the economic front, Deutsche Bank has warned that inflation risk in Europe is potentially underestimated, and there seems to be a surprising calm regarding key assets. The possible impacts of tariffs are still being downplayed.

A macro strategist from the bank mentioned that the upcoming tariff negotiation deadline between the U.S. and the EU on August 1 could induce slow results, leading to a significant market reaction.