How US tech pain is European stock markets' gain
EWG•European shares have risen about 2.7% in November as the STOXX 600 neared record highs, while the Nasdaq-100 fell about 2.7%. STOXX 600 companies are on track for 25% quarterly profit growth, the strongest in four years, with earnings and lower energy prices supporting shares.
1. European shares outperform
The STOXX 600 hit a record high and posted its biggest weekly gain since June, as investors rotated away from crowded AI-linked trades. It has risen more than 4% over two months, while the S&P 500 has lost roughly 0.8%; the Nasdaq-100 is down about 2.7% so far in November.
2. Earnings and sector mix
LSEG data shows STOXX 600 companies are on track for quarterly profit growth of 25%, the strongest in four years, with energy firms at the forefront. Information technology accounts for 8.8% of the European benchmark, compared with more than 35% of the MSCI USA Investable Market Index. Goldman Sachs strategists estimate that each 10% rise in Brent crude prices reduces European companies' total value by 1%.
