European equities: cautiously constructive at the headline level, but the country-by-country story is split.
Some recently published research has upgraded European stocks from underweight to neutral, pointing to steadier oil prices, better earnings revisions, and the view that geopolitical stress will hurt growth less than feared. That camp expects the earnings gap with the US to narrow into year-end. Institutional flow data cited by analysts backs part of this: June's most concentrated buying went into European financials, and managers started rebuilding French positions from underweight.
A contrarian thread pushes back on a 12-month view, flagging over-optimistic earnings expectations, stagflation risk, Chinese competition, and French political instability — and holds UK equities at a modest underweight for similar reasons. Separately, some tactical work sees the DAX drifting lower near-term on a lack of catalysts.
Underneath the index: Denmark and France are being accumulated, Germany is under sustained selling, and luxury names are held with conviction as relatively insulated from AI disruption.
The split looks like genuine disagreement, not just different time horizons.