European equities remain a compelling investment opportunity
23 OCT, 2025
By Joanna Piwko from RankiaPro Europe
Gilles Guibout, Director of European Equity Strategies at AXA Investment Managers (part of the BNP Paribas Group), believes that European equities remain a compelling investment opportunity compared to the U.S. market.
“In light of the current improvement in macroeconomic conditions and strong long-term political commitments, we believe European equities can continue to offer value relative to the U.S. market”, Guibout explains.
Despite challenges such as tariffs, geopolitical uncertainty, and slow economic growth, he sees significant potential in the region. “With attractive valuations, prospects for growth and consolidation, and fiscal stimulus from Germany and the EU, there are many reasons for optimism. A broad and growing range of investment opportunities remains available”, Guibout adds.
AI and data platforms driving growth
Guibout highlights that company data platforms and artificial intelligence tools are expected to continue driving growth in European equities, reinforcing the sector’s investment appeal.
2025 European equity performance
So far this year, the banking sector has been the standout performer in European equities. In August, European bank shares reached their highest levels since the 2008 global financial crisis, supported by long-term interest rates boosting banking profits.
European equities have outperformed other major markets in 2025. The Euro Stoxx 600 index has gained 25% in U.S. dollars, compared to 16% for the MSCI World Index and 13%–16% for the S&P 500 and Nasdaq. Part of this outperformance is attributed to the historically lower valuations of European stocks relative to U.S. equities.
Valuation discount remains attractive
European equities continue to trade at a significant discount compared to their U.S. counterparts, offering investors the potential for both growth and value in a diversified portfolio.
