European equities are sometimes seen as a ‘value’ market with only moderate growth. However, inflows into European equities are gathering pace this year. With the region’s activity accelerating, and valuations at multi- year discounts to the US, investors are taking notice once again. Arun Singhal, Global Head of Product Management at STOXX, speaks to IPE about the European equity market and the role indices play.

Arun, European equities are having a good year judging by prices and flows. What’s driving this interest?

“We’ve seen several years of headwinds within the European market in terms of allocation. Even if European indices did well in 2021 and 2023, many investors overweighted other regions - particularly the US -, as they sought exposure to hot sectors and themes within the Technology industry.

What we have noticed since late last year is a reversal of that sentiment towards European markets. There are several tailwinds behind that, whether that’d be market dynamics, valuations, or the macroeconomic background.”

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