ETFs to Consider as Europe's Market Rally Continues

European markets have maintained strong momentum, as the Stoxx 600 gained nearly 15% year to date, signaling sustained market confidence. The pan-European index has gained about 2.4% month to date, outpacing its transatlantic peer, the S&P 500, which has remained largely flat over the same period.

European stocks rose on Wednesday, marking the second consecutive record close, as the U.S. government shutdown ended, lifted by financials and solid earnings results. Additionally, economic data showed that the eurozone grew at its fastest pace in more than two years in October.

According to Nick Saunders, CEO of Webull UK, as quoted on Reuters, much of the recent rise in European markets has been driven by strong corporate earnings, particularly within the banking sector. Bank-heavy indices have led the rally, propelling the broader European market higher.

Per LSEG Lipper data, as quoted on another Reuters article, global equity funds recorded strong inflows in the week ending Nov. 5, as optimism around AI-driven corporate deals and renewed buying during the market pullback lifted investor sentiment. Investors poured $2.41 billion into European funds during the period.

Europe’s Economy Picks Up Speed

As per a survey, as quoted on Reuters dated early November, in October, the eurozone economy grew at its fastest pace since May 2023, as a rebound in service sector activity and stronger demand lifted overall economic momentum.

The S&P Global’s HCOB Eurozone Composite Purchasing Managers' Index advanced to 52.5 in October, up from 51.2 in September, extending its growth streak to the tenth month and hitting a 29-month high, signaling continued growth in activity.

Per the Reuters article, the services sector strengthened in October, with new business volumes rising at the fastest rate in over two years. The composite new orders index increased to 52.1 from 50.6, while the services activity index advanced to a 17-month high of 53.0.

ETFs to Consider

Below, we have highlighted a few ETFs with exposure to the eurozone for investors to consider.

Vanguard FTSE Europe ETF VGK

Vanguard FTSE Europe ETF seeks to track the performance of FTSE Developed Europe All Cap Index with a basket of 1,242 securities. The fund has gathered an asset base of $28.05 billion and charges an annual fee of 0.06%.

VGK has double-digit exposure to the U.K. (23.2%), France (14.5%), Germany (14.27%) and Switzerland (13.79%). The fund has a dividend yield of 2.85%.

Vanguard FTSE Europe ETF has a one-month average trading volume of about 3.15 million shares. The fund has gained 2.27% over the past month and 16.31% over the past year.

iShares MSCI Eurozone ETF EZU

iShares MSCI Eurozone ETF seeks to track the performance of the MSCI EMU Index with a basket of 219 securities. The fund has amassed an asset base of $8.35 billion and charges an annual fee of 0.51%.

EZU has double-digit exposure to France (30.54%), Germany (26.84%), the Netherlands (13.91%) and Spain (10.42%). The fund has a dividend yield of 2.42%.

iShares MSCI Eurozone ETF has a one-month average trading volume of about 1.37 million shares. The fund has gained 3.60% over the past month and 22.05% over the past year.

JPMorgan BetaBuilders Europe ETF BBEU

JPMorgan BetaBuilders Europe ETF seeks to track the performance of Morningstar Developed Europe Target Market Exposure Index with a basket of 387 securities. The fund has amassed an asset base of $8.34 billion and charges an annual fee of 0.09%.

BBEU has double-digit exposure to the U.K. (22.6%), France (14.6%), Switzerland (14.3%) and Germany (14%). The fund has a dividend yield of 2.21%.

JPMorgan BetaBuilders Europe ETF has a one-month average trading volume of about 2.67 million shares. The fund has gained 2.44% over the past month and 16.21% over the past year.

iShares Core MSCI Europe ETF IEUR

iShares Core MSCI Europe ETF seeks to track the performance of MSCI Europe Investable Market Index with a basket of 1,009 securities. The fund has amassed an asset base of $6.76 billion and charges an annual fee of 0.09%.

IEUR has double-digit exposure to the United Kingdom (23.19%), France (15.44%), Switzerland (13.92%) and Germany (13.86%). The fund has a dividend yield of 2.82%.

iShares Core MSCI Europe ETF has a one-month average trading volume of about 684,000 shares. The fund has gained 2.28% over the past month and 15.99% over the past year.

SPDR EURO STOXX 50 ETF FEZ

SPDR EURO STOXX 50 ETF seeks to track the performance of EURO STOXX 50 Index with a basket of 50 securities. The fund has amassed an asset base of $4.79 billion and charges an annual fee of 0.29%.

FEZ has double-digit exposure to France (34.29%), Germany (29.75%) and the Netherlands (14.29%). The fund has a dividend yield of 2.23%.

SPDR EURO STOXX 50 ETF has a one-month average trading volume of about 1.4 million shares. The fund has gained 3.79% over the past month and 19.43% over the past year.

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