BofA Adjusts STOXX 600 Target Amid Global Tensions

BofA Global Research increased its year-end target for the STOXX 600 index, citing resilient global growth amid a U.S.-China trade truce. Despite geopolitical tensions, European equities remain strong. The research firm also adjusted various sector ratings based on anticipated global economic pressures.

BofA Global Research has revised its year-end projection for the STOXX 600 index, now targeting 530 points, up from 500. This adjustment follows a trade truce between the U.S. and China, demonstrating resilience in global economic growth.

European shares are nearing record levels, even with ongoing global trade tensions and the Israel-Iran conflict. According to BofA, these geopolitical events have yet to manifest in a significant decline in global growth, despite maintaining a negative outlook for regional equities.

The brokerage's latest STOXX 600 target suggests a minor downside from its recent position. While a truce and favorable U.S. inflation data have eased market concerns, ongoing trade tariffs and Middle Eastern strife pose risks to global economic stability. Additionally, BofA upgraded European mining due to favorable valuations post-underperformance, while downgrading airlines amid potential oil price hikes linked to regional tensions.

(With inputs from agencies.)