European Equities Rally on U.S.-Iran Diplomacy and Record Earnings: What Investors Need to Know

Key corporate earnings

Novo Nordisk (August 4)

Novo Nordisk reported Q2 adjusted operating profit of 33.4 billion Danish crowns ($5.15 billion), up 11% year-on-year and above the mean analyst forecast of 28.74 billion crowns . The company raised its full-year 2026 outlook for both adjusted sales and adjusted operating profit . Wegovy pill adoption continued rapidly, surpassing 5 million U.S. prescriptions since its launch . Despite the beat, the stock reaction was muted — described by Reuters as "falls flat" — as Wegovy pill sales growth failed to impress the market on a standalone basis .

Sandoz (August 5)

Sandoz delivered H1 net sales of $5.8 billion, up 5% at constant currencies, with biosimilars surging 22% in Q2 to reach a record 33% of group revenue . Core diluted EPS grew 17% to $1.71, and core EBITDA margin expanded 90 basis points to 20.9% . The stock jumped roughly 8% on the day and as much as 23% in the session, with management calling it a "golden decade" for biosimilars .

Siemens Energy (August 5)

Siemens Energy reported a record Q3: orders up 19% year-on-year to €17.9 billion, revenue up 19% to €11.4 billion, and profit before special items more than tripled to €1.6 billion (14.2% margin) . Siemens Gamesa turned a positive quarterly result for the first time in years . Despite the headline strength, shares edged lower as investors weighed a softer near-term outlook .

U.S. record highs and falling bond yields

U.S. equities pushed to new record highs through this period, reinforcing global risk appetite and providing a tailwind for European markets . At the same time, bond yields fell — a signal that rate-cut expectations were rising and inflation fears were moderating. The combination of lower oil prices (reducing inflation pressure), diplomatic progress, and a strong earnings season drove a "risk-on" rotation that lifted both European and U.S. equities while compressing bond yields.