European equities are getting a quiet upgrade in published research — not as a conviction long, but as a place to hide if the AI trade keeps unwinding.
The core argument from several recent research notes: Europe is a consensus underweight, so any rotation away from crowded US tech and trimmed US equity allocations could mechanically lift European names. One camp of analysts flags European banks as the likely hiding place if the AI sell-off broadens, pointing to how Asian banks have already played that role, and highlights consumer staples as a rotation beneficiary. A separate strategist view expresses a relative preference for the Eurozone as part of rebalancing out of heavy US tech.
The caveat from a contrarian thread of recent research: non-AI US and European equal-weight indices are already down roughly 5% since summer, because AI-driven higher real yields lift the return hurdle for everything else. That drag holds only if real rates stay elevated.
On single names, one technical read flags Rheinmetall as still in a primary downtrend — down about 51% over twelve months, with a fresh 21-month low after earnings read as bearish follow-through.