European equities began the week with a measured climb. Financials and energy stocks are driving the move, redirecting attention toward sectors that had been largely sidelined in favour of growth and defensives.
Banks have been among the strongest contributors, with the sector benefiting from more than just yield curve expectations. Lending activity remains resilient, and European institutions are entering the next policy phase with stronger balance sheets and operational momentum, particularly in markets where credit demand has proven stable.
Energy and materials stocks are also regaining ground. This recovery is about investor appetite for cash-generative, asset-backed businesses heading into a year where capital allocation discipline is likely to be a key theme. The sector’s return to favour suggests renewed confidence in operational execution, dividend stability, and the potential for earnings upside if industrial activity picks up, particularly in emerging economies where inventories are tightening.
JPMorgan European Discovery Trust plc is an investment trust company. The Investment Trust JEDT objective is to achieve capital growth from a portfolio of quoted smaller companies in Europe, excluding the United Kingdom.
