European stocks are finally hot again
Xinhua News Agency/Getty Images
On Wednesdays, the Brew’s Sam Klebanov highlights a fascinating stock, commodity, or other asset that’s worth your attention.
Europe’s stock market is waking from its long slumber. For the first time since the Iran war began in February, investors bought European stock index ETFs more than they sold them last month, per Bloomberg data.
Despite fears of rising energy prices undermining the continent’s economy, Europe Inc. is blowing it out of the water:
- European companies are on track to report one of the strongest quarterly profit growth in years for Q2.
- It’s even outperforming the US in some parts of the market. EURO STOXX Bank index gained 20% this year, beating the 12% rise in its S&P 500 banking counterpart.
It’s also a hot hedge against the AI trade. BlackRock said $4.4 billion flowed into its European ETFs in July as cash was taken out of volatile chip stocks. And BNP Paribas said that while European companies might not be leading in developing AI, they could get a boost from using it.
But overall Europe still trails the US: Stoxx 600 is up 9% this year, slightly behind the 12% gain in the S&P 500