January 27, 2025

Eureka for Europe?

Market update

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Mae van Dalen

Europe and the US

Since 2007, Europe has been economically underperforming compared to the United States. Lower productivity growth, reduced investments, over-regulation, and a fragmented market are significant contributors to this trend. However, the perception that Europe is economically the weaker sibling of the US could be incomplete.

 

The current state of the European market

In 2024, the European stock market performed relatively poorly, whilst the American market, driven by technology companies, significantly outperformed. This has led to a situation where European stocks are currently valued much lower than their American counterparts. This underperformance is not a new phenomenon: over the past 17 years, European stocks have underperformed their American counterparts by a staggering 284%, resulting in the current record-low valuations.

 

Potential appeal of low valuations

The current low valuations of European stocks could indicate a potentially interesting entry point. Below are some factors that could contribute to an improvement in the European market:

  • A potentially less strict focus on austerity compared to the US

  • Possibly more room for the European Central Bank to ease monetary policy through interest rate reductions

  • A potential increase in global capital expenditure could stimulate European exports

  • Gradual improvement in the energy situation could strengthen the competitive position of energy-intensive industries

  • A possible resolution to the conflict in Ukraine could improve sentiment towards European assets


An opportunity for value investors

For value investors, the combination of low valuations and potential structural improvements could present an opportunity. The low valuations may provide a buffer against economic headwinds.


Read more about Mpartners' investment philosophy here.


Importantly, investors should always conduct their own research and carefully weigh their investment decisions against their personal financial objectives and risk tolerance.

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The content is intended solely for informational and educational purposes and should not be construed as investment advice. Investing involves risks, including the possible loss of capital, and past performance does not guarantee future results.


Mpartners B.V. is an investment firm and is registered with the AFM and DNB.


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Tell us about your Financial Goals

Discover the peace of mind that comes from having your assets invested wisely.

Discussion about financial objectives for asset management

Bespoke & Professional

Mpartners Employees
Mpartners Employees
Mpartners Employees
Mpartners Employees

15+ Years

Specialist in wealth

The content is intended solely for informational and educational purposes and should not be construed as investment advice. Investing involves risks, including the possible loss of capital, and past performance does not guarantee future results.


Mpartners B.V. is an investment firm and is registered with the AFM and DNB.


By using this website, you agree to the terms and our privacy policy.


© 2025 Mpartners B.V. All rights reserved.

Mpartners Asset Management Logo

Tell us about your Financial Goals

Discover the peace of mind that comes from having your assets invested wisely.

Discussion about financial objectives for asset management

Bespoke & Professional

Mpartners Employees
Mpartners Employees
Mpartners Employees
Mpartners Employees

15+ Years

Specialist in wealth

The content is intended solely for informational and educational purposes and should not be construed as investment advice. Investing involves risks, including the possible loss of capital, and past performance does not guarantee future results.


Mpartners B.V. is an investment firm and is registered with the AFM and DNB.


By using this website, you agree to the terms and our privacy policy.


© 2025 Mpartners B.V. All rights reserved.

Mpartners Asset Management Logo

Tell us about your Financial Goals

Discover the peace of mind that comes from having your assets invested wisely.

Discussion about financial objectives for asset management

Bespoke & Professional

Mpartners Employees
Mpartners Employees
Mpartners Employees
Mpartners Employees

15+ Years

Specialist in wealth

The content is intended solely for informational and educational purposes and should not be construed as investment advice. Investing involves risks, including the possible loss of capital, and past performance does not guarantee future results.


Mpartners B.V. is an investment firm and is registered with the AFM and DNB.


By using this website, you agree to the terms and our privacy policy.


© 2025 Mpartners B.V. All rights reserved.

Mpartners Asset Management Logo