European Stocks Rally to Fresh Record, Bolstered by Earnings

2lfwtt8py3wy4ozvg09q19m5_media_dl_1.png BloombergArticle content(Bloomberg) — European stocks powered ahead for a third day, reaching a fresh record, as strong earnings reports gave traders the confidence to keep rotating out of US companies and into ones from Germany, France and the UK. Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentThe Stoxx Europe 600 Index gained 1.2% by the close. Cyclical sectors led gains, with miners, technology and energy shares the biggest outperformers.Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle contentThe index has climbed 6.2% this year, with investors taking the view that Europe offers steady economic growth and cheaper valuations at a time when there’s more anxiety about US technology stocks. Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article contentGains were more subdued in the US, where the S&P 500 rose 0.8% by the European close and is up less than 1% for the year. Article contentNicolas Domont, a fund manager at Optigestion in Paris, said he recently cut his US holdings to 50% from 70% and added more European shares. The latest Bank of America survey showed plenty of investors are making similar bets, with a net 35% saying they are overweight European equities relative to global markets, up from 9% just three months earlier. Article content“Like the rest of the market, we’re continuing to rotate,” said Domont. “The AI scare trade is creative destruction in the making and when one doesn’t know how it will unfold, one diversifies.” Article contentFund Managers Rediscover Bullishness for Europe: Taking StockArticle contentAmong individual movers, BAE Systems Plc gained 4.0% after saying it expects solid earnings growth, an indication that the rapid expansion of defense budgets shows little sign of abating. Article contentArticle contentThe standout mover of the session was Raspberry Pi Holdings Plc, which at one stage surged as much as 33% before erasing gains. The stock has rebounded from a record low two weeks ago after a social media post highlighted that AI agents like OpenClaw could drive demand for Raspberry Pi’s single-board computers. Article contentThe AI disruption is continuing to cause some big market swings, said Francois Dossou, head of equities at Sienna Gestion in Paris. Article content“Yes the Stoxx 600 is at a record high, but there are very violent individual movements below the surface which blur the overall picture,” he said. “On the bright side, this earnings season has produced a real growth in profits.” Article contentJPMorgan Chase & Co. strategists have echoed that bullishness. They expect earnings to accelerate in 2026 after a period of underperformance. Article contentOther stock movers include: Article contentBayer AG shares dropped 7.1%, the most since August, amid uncertainty around attempts to settle lawsuits tied to Roundup weedkiller.EssilorLuxottica SA fell 2.9%. Bloomberg reported that Apple is accelerating development on new wearable devices, including smart glasses.Trending Garry Marr: For young Canadians who bought at peak of market, Home Buyers' Plan was invitation to disaster First-Time Homebuyers Cooler inflation gives Bank of Canada an opening to cut rates if economy falters, say economists Economy Posthaste: Canada's biggest city is losing momentum, and that's a problem for the whole country News Canada's home sales plunge in January, led by Ontario Real Estate Carney Poaches Third Conservative Defector, Chasing Majority PMN Business Article contentFor more on equity markets:Article contentFund Managers Rediscover Bullishness for Europe: Taking StockM&A Watch Europe: Mediobanca, Volkswagen, Satim, Bank of IrelandEurope’s Fragmentation Hampers IPOs, Citi Says: ECM WatchUS Stock Futures Unchanged; Axcelis Technologies, La-Z-Boy FallBetting on BOE Cuts: The London RushArticle contentYou want more news on this market? Click here for a curated First Word channel of actionable news from Bloomberg and select sources. It can be customized to your preferences by clicking into Actions on the toolbar or hitting the HELP key for assistance. To subscribe to a daily list of European analyst rating changes, click here.Article content—With assistance from Rose Henderson.Article contentShare this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. Garry Marr: For young Canadians who bought at peak of market, Home Buyers' Plan was invitation to disaster First-Time Homebuyers Cooler inflation gives Bank of Canada an opening to cut rates if economy falters, say economists Economy Posthaste: Canada's biggest city is losing momentum, and that's a problem for the whole country News Canada's home sales plunge in January, led by Ontario Real Estate Carney Poaches Third Conservative Defector, Chasing Majority PMN Business