It's rare enough to be underlined: the European Stock Exchange is running in mind against Wall Street. While the American clues are struggling to take off, European markets are soaring like a fried barracks. Behind this feat, a cocktail of factors: hopes of peace in Ukraine, massive investments in defense and a market deemed more attractive than uncle Sam. It remains to be seen whether this dynamic is sustainable or if Europe plays only the leading roles for an act.
The European scholarship in full euphoria: towards a new golden age?
It is historic: Europe, struck by an economic crisis, does better than the United States on the stock market. The German Dax climbs by 17 %, the CAC 40 French by 11.5 % and the FTSE 100 British by 9 %. Meanwhile, the S&P 500 stagnates below the 1 %mark. Such a difference had not been observed since the year 2000, According to Morgan Stanley.
Behind this craze, several factors:
- Peace prospects in Ukraine that reassure investors;
- A rise in defense expenses in Europe;
- An economy that finally seems to come out of its torpor;
- Even attractive European actions, with a 14x course/profits ratio against 22x in the United States.
Europe also appeals thanks to impressive investment flows. Kyrylo Shevchenko sums it up well:
“” Europe has attracted $ 12 billion in four weeks, a record for a decade. »»
But can this stock market euphoria really extend or is it a simple catch-up effect?
Investors are relying on a virtuous cycle fed by the drop in interest rates and budget recovery. But is there a big stranger: Is Wall Street really distant or prepare a return in force?
Europe redefines its economic model: opportunity or mirage?
The EU is reviewing its economic copy. Between the Folding of the United States on themselves And the urgency of strengthening its strategic autonomy, it massively injects capital into defense and infrastructure. The PMI index, which measures industrial activity and services, shows signs of improvement, presage an outing of stagnation.
One of the engines of this embellished? The rebound of mergers and acquisitions in Europe, up 20 % over a year. In addition, the European Central Bank could be more flexible on rates, unlike the delayed Fed.
But everything is not rosy. As a Morgan Stanley analyst notes:
“” American policy vis-à-vis Russia and Ukraine could rebatch the cards of economic alliances. »»
Other uncertainties remain: Trade tensions with Chinathe volatility of energy prices and the real impact of investments in defense. Is Europe in the process of reinventing itself or simply compensating for a delay accumulated for years?
After a week when Europe has outperformed Wall Street, will Mars be the month of confirmation? Investors keep an eye on the next monetary decisions and geopolitical developments. Is the sustainable switch to Europe on Europe?
Maximize your Cointribne experience with our 'Read to Earn' program! For each article you read, earn points and access exclusive rewards. Sign up now and start accumulating advantages.
