European equities sent mixed signals this week, with UK income plays and select German names finding support even as broader sentiment stayed cautious.
On the bearish side, one strand of research argued against going long Europe altogether, citing structural energy imbalances and a leadership disconnect from geopolitical reality. The DAX struggled for momentum around the 25,000 line, and Rheinmetall was knocked by Berlin's sudden cancellation of a major frigate order — a reminder of how exposed defence names are to procurement risk. Analysts also flagged "bad" European gas companies as portfolios to trim.
UK research leaned more constructive in places. With gilt yields drifting higher, the FTSE 100 was preferred over the FTSE 250 thanks to its international earnings mix, while financials and energy were tipped as relative winners and real estate and utilities as the obvious losers. Stock-specific notes made the bull case for Moonpig and Spirax-Sarco as mispriced quality.
A more optimistic medium-term view on Germany also surfaced, pointing to recovering industrial orders and modest GDP growth into 2027.