”While the European stock market has failed to keep up with the recent rally in the US, the general environment has become more difficult to predict, with some sectors already struggling while others seem to remain robust. So far this earnings season, it has mainly been US banks that have reported their results, showing a solid earnings environment that has led to an increase in the US banking index of as much as 7% since reporting began last week. On the flip side, the semiconductor sector has been showing signs of weakness, with an important European chip equipment maker announcing a significant miss of orders and lower guidance for 2025 earlier this week. Not only does this echo earlier skepticism over the AI-driven rally but also, more broadly, the slowdown in this economy-sensitive industry does not bode well for the demand outlook for semiconductors, traditionally a reasonable indicator for global growth.”
Morten W. Langer
