US Consumer Staples: The Weekly Tab: Everybody Loves A Good Comeback Story

This UBS weekly report reviews the US consumer staples sector. The XLP outperformed the S&P 500 by about 476bps week-to-date, bringing its two-week cumulative outperformance to roughly 760bps, the sixth-best two-week stretch in the past decade. However, investor sentiment remains largely unchanged, with the move driven more by a more uncertain macro backdrop than by fundamental improvement. The report maintains that top- and bottom-line trends remain challenging, as category trends have yet to inflect meaningfully and cost pressures are likely to persist into CY27. Stock-specific actions include upgrading Scotts Miracle-Gro to Buy with a $70 price target, resuming Spectrum Brands at Buy with a $97 target, and noting Kimberly-Clark's 3Q EPS beat and reiterated FY26 guidance. P&G is scheduled to report on October 22. The team favors companies with superior growth or sequential improvement.