European equities drew a broadly constructive tone from published research this week, with the DAX repeatedly flagged as poised for modest gains and Euro Area earnings momentum finally turning up after three years of stagnation.
Several analysts pointed to a positive EPS inflection, with consensus now looking for double-digit earnings growth this year and next, supported by German fiscal expansion, a better-than-expected Ifo print, and AI-related capex reaching Germany. Structural bull cases were made for European defence, aerospace and space stocks, tied to multi-decade rearmament budgets and strategic autonomy programs. Financials drew overweight calls on a steeper curve and higher-for-longer rates, while industrials were highlighted as beneficiaries of EU stimulus and electrification. A contrarian thread argued non-US developed markets could outperform the US over the coming decade.
Not all views aligned: one note flagged weak Euro Area consumer spending and elevated household savings intentions as a drag on any consumption-led acceleration, and a separate underweight stance on European equities persisted on relative growth grounds.