Choose European Stocks Over the US

Choose European Stocks Over the US - at www.moneyweek.com - the best of the international financial media

European stockmarkets, along with many of their global counterparts, have long been correlated with the US. Indeed, according to Merrill Lynch, 99% of the variation in monthly European stock prices has historically been down to the S&P 500 index, the dollar/euro exchange rate and the ten-year US Treasury bond yield. But this year, the main US indices have barely shifted, while the FTSE Eurofirst 300 index is 16% ahead.

So why have they diverged, and can Europe's out-performance endure? One reason is interest rates. In the US, rates have risen ten times since mid-2004 and further monetary tightening is on the cards, while the European rate environment has been more benign with no change in the price of money for two years.

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Andrew Van Sickle
Editor, MoneyWeek

Andrew is the editor of MoneyWeek magazine. He grew up in Vienna and studied at the University of St Andrews, where he gained a first-class MA in geography & international relations.

After graduating he began to contribute to the foreign page of The Week and soon afterwards joined MoneyWeek at its inception in October 2000. He helped Merryn Somerset Webb establish it as Britain’s best-selling financial magazine, contributing to every section of the publication and specialising in macroeconomics and stockmarkets, before going part-time.

His freelance projects have included a 2009 relaunch of The Pharma Letter, where he covered corporate news and political developments in the German pharmaceuticals market for two years, and a multiyear stint as deputy editor of the Barclays account at Redwood, a marketing agency.

Andrew has been editing MoneyWeek since 2018, and continues to specialise in investment and news in German-speaking countries owing to his fluent command of the language.