BofA European equities analysts are bearish on European stocks, despite the European economy picking up. They argue that the good news is already priced in, with margin expectations at record highs and risk premia at a 20-year low.
Economic Growth and Stocks
The analysts note that the impact of German fiscal stimulus is finally set to materialize, with Euro area domestic demand growth expected to reaccelerate through year-end. However, they don’t think this will help European stocks, as the market remains priced for perfection.
The AI boom has helped the European stock market, but the analysts are concerned that AI models are becoming commoditized, which could call into question AI capex expectations and threaten the AI-led momentum.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
