While the US estimates are being cut from a much higher level, the trend nonetheless bodes well for Europe’s benchmark Stoxx 600 Index, which is on track for its best first-quarter performance relative to the S&P 500 in 10 years.
Investors have been drawn by cheaper valuations, as well as optimism around fiscal reform following the German elections and hopes for a ceasefire in Ukraine.
In the US, the technology heavyweights have trailed this year on worries about hefty spending on AI. The focus in Nvidia’s quarterly report — due Wednesday — will be on the growth outlook as it deals with supply challenges and potentially tighter controls on sales to China.
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Nvidia’s shares haven’t yet fully recouped the declines they suffered in late January on concerns that demand for its products would wane following the success of Chinese chat-bot startup DeepSeek.
Still, some Wall Street strategists including Morgan Stanley’s Michael Wilson see US earnings remaining healthy overall and a robust economic outlook keeping the flight from American assets short-lived.
