In 2024, mega-cap stocks have continued to perform strongly, providing a safe haven for investors amidst geopolitical tensions. The Euro Stoxx 50 index has risen by 9%, while the top 100 US stocks have surged by 19%. The elite European GRANOLAS have seen an average return of 16.6%, with the US’s Magnificent Seven doubling that with a 38% increase, driven by Nvidia’s AI rally.
The GRANOLAS, comprising the largest European companies by market cap, have collectively achieved a 17% return since the start of the year. However, the Magnificent Seven, including tech giants like Microsoft, Apple, and Nvidia, have outperformed them with an average return of 37%.
The significant outperformance of the US stock market can be attributed to the explosive growth in Nvidia and other chipmaker stocks, driven by investor and analyst optimism about artificial intelligence’s potential. This disparity highlights the challenges Europe faces in competing in the AI and semiconductor sectors.
In DailyBubble’s opinion, Europe needs to focus on enhancing its capabilities in these areas to compete more effectively on the global stage. The continuous optimistic outlook on the potential of artificial intelligence to enhance long-term productivity underscores the importance of investing in these sectors for sustained growth.