Deutsche Bank today reaffirmed its Buy recommendation on Reckitt Benckiser Group PLC, contrasting sharply with RBC Capital Markets’ downgrade to Sector Perform. Deutsche Bank analysts cited the company’s long-term strategic positioning in hygiene and health product categories as a key driver, even as RBC cut its price target to £62 and factored in the disposal of the Essential Home business and a £1.6 billion special dividend accompanied by a 10-for-1 share consolidation. Deutsche Bank argued that these actions strengthen the balance sheet and create optionality for future M&A, underpinning their bullish stance.

In its first-quarter cross-asset outlook, Deutsche Bank warned investors that while the macroeconomic backdrop remains supportive for equities—highlighted by consensus earnings growth forecasts of around 10 percent for 2026—markets are moving at a quicker pace and volatility is set to rise. The bank pointed to tightening liquidity conditions in fixed income and rapid rotation between sectors as factors that could trigger intra-day swings of 1 to 2 percent in major equity indices. Deutsche Bank’s strategists recommend maintaining exposure to high-quality cyclical names and using equity derivatives to hedge against sudden repricings.

Deutsche Bank research noted that American stocks underperformed global peers last year—posting a 2 percent deficit relative to MSCI World ex-U.S.—and warned that this trend could persist if valuations remain elevated in the U.S. versus Europe. The bank highlighted a 15 percent premium on the forward price-to-earnings ratio of the S&P 500 compared with Europe’s STOXX 600, and suggested that investors allocate up to 20 percent of U.S. equity portfolios into selected European sectors such as financials and autos, where relative earnings revisions are turning positive.

Deutsche Bank shares have risen above book value for the first time since 2008, reflecting improved capital generation and investor confidence. The bank’s recent Tier 2 bond issuance, which attracted over €5 billion of orders for a €1 billion deal, underlines this shift. Management now emphasizes execution—delivering return on tangible equity above 10 percent and maintaining cost-income ratio around 65 percent—over multiple expansion. Analysts warn that with mechanical buyback benefits fading at book value, future upside hinges on consistent earnings delivery, disciplined cost control and predictable capital distributions.