Key Takeaways
- European investors continue to rotate away from rate-sensitive and secular-growth stocks into value sectors.
- At the country level, Switzerland, Spain, and Italy outperformed.
- An 18% gain by Swiss pharma stock Roche helped drive healthcare’s outperformance.
The Morningstar Europe Index delivered a moderately positive return in November, ending the month with a gain of 0.89% in euros. The Swiss market was the clear winner with a monthly return of 3.52%, followed by Spain, which gained 2.71% and Italy, which rose 1.40%. Germany ended the month 0.09% lower and France finished November 0.06% down.
European Value Stocks Performed Better Than Growth Stocks
In November, value stocks outperformed growth stocks. The Morningstar Developed Europe Value Index returned 2.63%, beating the Morningstar Developed Europe Growth Index,which fell 0.64%. That pattern—value leading, growth lagging, and large-cap stocks holding up better than small-cap stocks—largely mirrors what happened at sector level, with healthcare and financials outperforming, and tech underperforming.
Investors continue to rotate away from rate-sensitive and secular-growth stocks and instead into value stocks: The difference in returns between the two investment styles peaked at the end of last month at 17.3%.
European Healthcare Stocks Up, Technology Down
At sector level, the strongest performers were healthcare (4.94%), financial services (3.02%), consumer defensive (2.35%) and utilities (2.29%), while technology (-4.06%), communication services (-2.93%) and industrials (-2.76%) underperformed. That sector profile explains much of the country and style moves: Markets with heavy healthcare and financial weightings like Switzerland outperformed; countries with tech-heavy exposures struggled.
Which European Stocks Rose and Fell in November?
At the individual stock level, November’s European equity performance was largely defined by the behavior of each sector’s dominant large-cap names. The strongest contribution came from Roche ROG (18.5%). Its stock price surge reinforced healthcare’s position as the top-performing sector of the month.
Defensive consumer bellwethers also added stability: Nestlé NESN (3.24%) in consumer defensive and LVMH MC (3.82%) in consumer cyclical both delivered solid gains, consistent with the broader resilience of noncyclical and premium-brand segments. In utilities and communication services, sector leaders Iberdrola IBE (3.53%) and Deutsche Telekom DTE (3.24%) also performed well.
In contrast, several heavyweight laggards dragged on their respective sectors. Siemens SIE (—7.03%) pulled industrials lower, mirroring the sector’s broader challenges in November, while ASML ASML (—1.60%), Europe’s most high-profile tech stock, contributed to technology’s negative month. Shell SHEL (—1.00%) in energy and Rio Tinto RIO (—0.87%) in basic materials also posted slight declines, reflecting subdued investor sentiment in the commodity and energy sectors.
