1. Investors focus on Nvidia earnings and find it too cheap.

AI heavyweight Nvidia climbed 2.1% and reached a record-high close, boosting its stock market value to $5.76 trillion.
“Nvidia remains very early in the ramp of a new product cycle, powered shell constraints play into Nvidia’s strengths, and recent agentic enthusiasm can accelerate Vera adoption. With the stock still relatively inexpensive at 15x FY28 EPS, there's opportunity for multiple expansion if enthusiasm returns to AI but multiple expansion is also not required for the stock to work as numbers continue to go higher. Nvidia has also underperformed more CPU stories around the recent Muse enthusiasm, but outperformance will broaden as consumer agents as a category add to long term AI use cases and token demand.”

Below: there is room for “GPU’s” to catch up with the “CPU’s”. It’s not too late to buy Nvidia!

2. Euro falls to 1.12.

The main driver is Friday’s US jobs report which took money market odds of an October hike to below 25%.
They still expect a hike in December and another two in the first half of 2027.
The euro's appeal as alternative to the dollar was already fading after the Federal Reserve's September rate hike, but political turmoil in France and Madrid drags down the euro.

3. Eurozone activity proves to be more than resilient, in fact it is accelerating.

Euro area PMI’s continue to point to strong growth of around 1.7% annualised.
The PMI survey shows a further pick-up in growth in Spain, with the composite index at 56.8 (+1pt), consistent with a 3.7%ar growth rate. The strength in the Spanish survey is particularly striking, and comes on the heels of today’s announcement around an early election. Elsewhere, the German and French composite PMIs are consistent with growth running at 1.8% and 1.1% respectively.
Eurozone PMIs are up for 4 months in a row, and the latest IFO made 3 year high.

Below: The Eurozone economic surprise index is powering higher.

4. European stocks are oversold.

Eurozone was a relative loser from the conflict, and is at a relative disadvantage when Tech is ahead, given the index composition.
Also, French political risk will stay a headwind for the region for a while but a contrarian potentially bullish view could emerge after the French/Spanish elections. The positive is that CAC40 has already done poorly and a lot of bad news is in the price.
Last but not least, a weaker Euro is good for exports.

5. Change in P/E valuation since start of the conflict.

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