From Morningstar: 2024-12-30 13:21:50

In 2025, European stocks have a potential 5% upside, making them an attractive option compared to global and US stocks. The macroeconomic backdrop is improving, with GDP growth expected to be around 1.5% and falling inflation rates. However, potential trade restrictions and political issues could pose risks to European equities.

Future US trade policies could impact European stocks negatively. Political instability in France and Germany, as well as the looming US presidential election, could further affect European equity markets. Currency risks, such as the depreciation of the Euro against the US dollar, could also impact European businesses and consumers.

Despite these challenges, European equity markets offer decent forward visibility and attractive opportunities for investors. Sectors like consumer cyclicals are trading at discounts, which could narrow with interest rate reductions. Being aware of potential risks ahead of time gives investors a balanced view of the risk/reward trade-off for 2025. 1. The stock market saw a sharp decline today, with the S&P 500 dropping 2% and the Dow Jones falling 500 points. Investors are concerned about rising inflation and the impact of the ongoing trade war with China.

2. A new study has found that 70% of Americans are not saving enough for retirement. The average retirement savings for those aged 55-64 is only $104,000, far below the recommended amount. Experts are urging people to start saving more aggressively.

3. The US economy added 200,000 jobs in the month of August, surpassing expectations. Unemployment remains at a low 3.7%, with job growth seen in sectors such as healthcare, professional services, and manufacturing.

4. Hurricane Dorian is expected to make landfall in Florida as a Category 4 storm, with winds reaching up to 140 mph. Residents are being urged to evacuate and prepare for potential flooding and power outages. Emergency services are on high alert.



Read more at Morningstar: Equity Strategy Monthly: What to Expect in 2025