For years, U.S. stocks have been beating the rest. Thanks to the great American domestic market and “mega technos”? Yes, but not only that: a phenomenon as trivial as technology also comes into play.
Will 2025 see a comeback for European equities? Almost every year, a certain number of observers believe that the trend is reversing, that the Old Continent is catching up with America, which for years has been the world’s stock market powerhouse. The argument often put forward is valuation: European equities are suffering from a discount that should enable them to catch up. This argument remains valid today, and is even more compelling than ever.
Wall Street still shines
At the end of October, the MSCI USA index was paying itself 21.6 times earnings for the coming 12 months, while this ratio was only 13.3 for the MSCI Europe. An almost unprecedented gap. On the other hand, another argument put forward by many strategists at the start of the year fell flat. At a time when the European economy was set to pick up speed, just when it was feared that the US economy would suffer a hard landing, this shift, which would have favored the…