U.S. investors have stepped up their purchases of European stocks — even as performance this year has been neck-and-neck with what they can get domestically.
On Wednesday, European stock exchange-traded funds — the JPMorgan BetaBuilders Europe ETF
the iShares MSCI Eurozone ETF
and the Vanguard FTSE Europe ETF
— accounted for three of the top eight stock funds purchased by U.S.-based investors. European stock ETFs have seen inflows of $7.6 billion from U.S. investors in 2021, according to FactSet data.
The flows have come as Europe has stepped up its COVID-19 vaccination efforts, providing hope for an economic acceleration that so far has lagged behind, compared with the U.S., and as European stocks carry less demanding valuations.
Analysts at Jefferies say their tracker of European activity was at 85% of pre-COVID-19 levels. “The euro area economy continues to bounce back, with the latest Ifo [Institute for Economic Research] and INSEE [National Institute of Statistics and Economic Studies] surveys indicating a significant improvement in business confidence in Germany and in France, led by the services sector,” they said, recommending payments company Adyen,
payments-focused bank Nexi
and automobile maker Stellantis
as ways to play the recovery.
That said, stock-market performance has been roughly the same on both sides of the Atlantic. In dollar terms, the Stoxx Europe 600 has climbed 12% in 2021, as has the S&P 500
shares jumped 6%, as the plane maker set out plans to increase production. From 45 A320 narrow-body aircraft a month in the fourth quarter, the Boeing
rival expects to increase production to 64 by the second quarter of 2023 and is investigating opportunities to raise production to as high as 75 by 2025. Airbus also said it would increase production of two other models, the A220, which is the smallest jet it makes, and the A350 long-range jet.
shares slumped 4%, after a U.S. judge rejected plans for the company to set aside $2 billion for people who aren’t yet sick or haven’t yet sued after getting cancer from using Roundup weedkiller. Bayer says it might remove the product from the U.S. entirely for retail users.
Tate & Lyle
shares fell 4%, after forecasting adjusted earnings per share to fall due to lower profitability in its commodities business and an increase in the tax rate, as it also said its artificial-sweetener making primary products unit was still on the market.