Higher for longer adds defensiveness - Upgrading CABK to Buy

Spanish domestics' shares have remained strong through the summer, with convergence between higher/lower ROTE entities post 2Q suggesting a thematic rather than stock-specific narrative whereby the entire domestic space offers a good balance between defensiveness and gearing to macro/earnings tailwinds (loan volumes, higher rates, steady markets), making them "stocks for all seasons". We upgrade CaixaBank (CABK) to Buy, joining BCP and SAN as our preferred Iberian options. We raise rate assumptions (2.75% YE27E and 2.5% thereafter, both c50bp above previous forecasts) and make small 1-2% NII adjustments outside UNI (+5-6%). Rising deposit cost "tension" is the biggest bottom-up risk;