European stocks post biggest weekly outperformance over S&P 500 since March

S&P 500: The S&P 500 is a broad U.S. large-cap equity index that tracks leading companies across major economic sectors. It lagged European equities during the reported week as higher bond yields and caution toward the AI investment trade weighed on U.S. stocks. European stocks: European stocks are shares listed across the region’s major equity markets, commonly represented by the pan-European Stoxx Europe 600 index. In the reported week, they gained relative to the S&P 500 as investors rotated away from AI-related technology exposure toward more defensive sectors, while some European earnings news provided additional support. Market rotation: Investors were shifting away from the AI trade as elevated bond yields made AI infrastructure spending less attractive and increased the appeal of alternatives to equities. US market pressure: The S&P 500 was heading toward its weakest week since August amid inflation concerns, higher yields, and a pullback in technology shares. European leadership: Industrials and financial services led the reported advance in the Stoxx Europe 600, while healthcare stocks lagged.