Barclays strategists said that although the fundamentals of economic growth have improved, the strong performance of the European stock market has come to a standstill due to higher energy prices and rising interest rates compounded political uncertainty. At the same time, the strategist pointed out that the increase in German defense and infrastructure spending, as well as a wider investment cycle, will still benefit sectors and bank stocks benefiting from capital expenditure. The research team led by Emmanuel Kao believes that after the comparative advantage of the European stock market subsided and the recovery of large US technology stocks, the risk-benefit ratio of the market tended to be balanced. European stock market valuations are still supported, but there is a lack of clear catalysts that can push them to reap relative gains. The team is optimistic about the industrial sector, which will be supported by German fiscal stimulus and investment in defense, infrastructure, energy, and artificial intelligence; the environment where high interest rates last longer will benefit the banking sector. Between Germany and France, they are more optimistic about the German market: improvements in German economic activity and rising profits have not been fully reflected in stock prices.

Barclays strategists said that although the fundamentals of economic growth have improved, the strong performance of the European stock market has come to a standstill due to higher energy prices and rising interest rates compounded political uncertainty. At the same time, the strategist pointed out that the increase in German defense and infrastructure spending, as well as a wider investment cycle, will still benefit sectors and bank stocks benefiting from capital expenditure. The research team led by Emmanuel Kao believes that after the comparative advantage of the European stock market subsided and the recovery of large US technology stocks, the risk-benefit ratio of the market tended to be balanced. European stock market valuations are still supported, but there is a lack of clear catalysts that can push them to reap relative gains. The team is optimistic about the industrial sector, which will be supported by German fiscal stimulus and investment in defense, infrastructure, energy, and artificial intelligence; the environment where high interest rates last longer will benefit the banking sector. Between Germany and France, they are more optimistic about the German market: improvements in German economic activity and rising profits have not been fully reflected in stock prices.