2Q26 Review/Preview; Looking past peaks

Research evidence excerpt

2Q26 Review/Preview; Looking past peaks

Powered by Lab Global6 JulyResearch2026ab Evidence UBS YES

N.A. Chems & Pkg’g Equities

North America2Q26 Review/Preview; Looking past peaks

Chemicals, Commodity

Joshua Spector, CFA

We expect a better setup for downstream chems/pkg vs upstream/commodity Analyst

We don't expect a material change in demand/volumes this quarter, which will still joshua.spector@ubs.com

remain a debate for the broader sector. Industrial markets/PMIs have be +1-212-713 6188

expansionary in most regions, which can help some of our coverage, most other Lucas Beaumont

markets remain stable to down (building/construction, auto OEM, consumer). Analyst

Electronics remains the one pocket of outright growth (ESI remains a top pick). This lucas.beaumont@ubs.com

leaves our overall top preferred sub-sectors and stocks unchanged. With falling oil/ +1-212-713 4809

raw materials over the last month, and the prospect of a full reopening of the Strait Christopher Perrella

of Hormuz, we'd expect investors to look past peak raws inflation in our Analyst

downstream coverage over the coming quarters, and focus on markets with a christopher.perrella@ubs.com

better volume outlook and companies that can hold onto pricing. We see this as a +1-212-713 1443

good setup for ECL, LIN, & RPM in our coverage where we have Buy ratings, but Anojja Shah

could see similar positives for other industrial coatings (AXTA, PPG), and gases Analyst

(APD). On the other end, we don't see investors broadly stepping into anojja.shah@ubs.com

commodities until there is more clear visibility of a bottom. We think commodity +1-312-525 4310

beats, if there are any, get looked through, and focus is on if 2027 numbers are James Cannon

low enough to reflect a return to lower prices and stagnant growth.