Europe’s stock markets are attracting investor attention
The rally in European stock markets is driving investor interest.
1Rally in European stock markets
European stock markets have seen a significant rally recently. The Stoxx Europe 600 Index rose every day last week, marking the longest streak of gains since June. Helen Jewell, international chief investment officer at BlackRock, noted growing interest in Europe and the region’s economic resilience surprising the markets.
2Earnings and economic momentum
European companies reported their best earnings growth in four years at 17%. With the strongest economic momentum since March 2023, strategists believe the rally is supported by solid fundamentals. Mark Haefele from UBS Global Wealth Management suggested it’s time to consider investing in European equities.
3Investor interest in Europe
According to Bank of America’s latest survey, 2% of fund managers are now overweight on European equities, compared to 15% underweight in June. Citigroup analysis found Europe was the only major region to see a meaningful improvement in risk appetite in late July.
4Regional indices hitting records
The Stoxx 600 Index has risen 11% this year. Regional benchmarks like the German DAX, French CAC 40, and Italian FTSE MIB have also reached all-time highs. About 75% of Stoxx 600 constituents are trading above their 200-day moving average.
5Geopolitical impacts
Easing tensions between Washington and Tehran have positively influenced market sentiment. However, concerns remain about the full reopening of the Strait of Hormuz. Oil prices have declined from their July peak, easing inflation worries.
6AI driving growth
Investments in artificial intelligence (AI) have become a key driver in European markets. Semiconductor firms like ASML Holding NV and Infineon Technologies AG have surged over 60% in 2026. Bank of America’s basket of European AI adopters has gained 14% this year.
7Tech alternatives
Europe’s economic sectors, such as banks and industrial goods, are seen as alternatives to tech investments. The Stoxx 600 Banks Index is among the top performers this year, rising 22%. Beata Manthey from Citigroup noted that tech is now a complementary rather than contradictory investment.
8Future outlook
The Stoxx 600 Index is trading at 15 times forward earnings, the smallest discount to the S&P 500 in four years. However, some investors remain skeptical about Europe’s long-term growth potential. Daniel Murray from EFG Asset Management argued that skepticism toward European stocks has gone too far given strong macro growth and solid earnings.
Original article: Fortune | FORTUNE — Avrupa borsaları yatırımcıların ilgisini çekiyor