Few charts to end the week

Since beginning of the year the Median stock in Europe has outperformed the median stock in the rest of the regions. Performance has been mixed but it’s interesting to see how European Banks (SX7P) have considerably outperformed the MAG7. We have seen a marked improvement in European ROE which is second only to US. China competition is always flagged as a risk for Europe but autos and chemicals who are most impacted are just a limited part of the overall SXXP index whereas the other sectors are more isolated. Higher energy prices can support Energy, Utilities, Basic Resources and Chemicals. US continues to offer a lot more growth than Europe which remains a key headwind. Markets have taken a more pro-cyclical tilt in the last month and outperformed defensives, both in Europe and US. Small-caps have been strong but only in the US whereas it has underperformed in Europe. Finishing off with a few charts from a Space report we published this week. It shows how the space industry has transformed from governments driving investment and launches to now instead being private capital. The amount of objects orbiting earth has increased a lot rising the risk of collisions. Space is also becoming much more important from a Defence perspective. Few charts on all of this below.

The median stock in Europe is up double-digit so far in 2026; despite an Energy shock

Total return in 2026; local currency (APxJ in USD)

Source: Datastream, FactSet, Goldman Sachs Global Investment Research

European Banks have outperformed the Magnificent 7 since 2022

Total return, indexed to 100 in January 2022

Source: Datastream, Goldman Sachs Global Investment Research