Europe could be a 'compelling story' J.P. Morgan says, lifts equity index targets

Europe’s outlook for equities is getting a bullish push after J.P. Morgan raised its year-end targets, framing the region as potentially “compelling” as geopolitical tensions ease. On June 29, the Wall Street brokerage lifted its STOXX 600 benchmark target to 680 from 630, implying roughly 7% upside from Friday’s close of 635.88 points. It also increased its MSCI Eurozone index target to 420 from 385. J.P. Morgan linked the move to stronger corporate earnings and improved geopolitical conditions after a U.S.-Iran peace deal helped stabilize markets amid Middle East conflict-linked inflation and rate-hike concerns. Risks remain, including renewed escalation, but improving oil prices, lower bond yields, reduced tariffs, and a China growth pickup could support further gains. The firm noted global investors remain underexposed to Europe and reiterated an “overweight” stance, expecting Eurozone earnings growth of about 20% in 2026 after contraction in 2025.