Special Encore: What’s Driving European Stocks in 2026

The podcast explores the outlook for European equities in 2026, particularly in comparison to the U.S. equity market. Despite U.S. equity market outperformance since the U.S. elections, European equities have shown surprising strength, breaking a decade-long discount range versus the U.S. Diversification flows are increasing into European equities, driven by the concentrated nature of the U.S. market. While U.S. earnings growth is projected to be significantly higher, AI adoption in Europe presents a compelling bull case, with leading adopters demonstrating strong earnings and returns outperformance. Sectors to favor include banks, defense, and those powering AI, while autos, chemicals, and luxury goods should be avoided.