European
stock
markets
have
had
a
slow
start
to
the
year,
with
the
Morningstar
Europe
Net
Return
Index
up
1.4%
in
euros
in
January.
But
this
result
hides
sharp
differences
between
sectors,
factors
and
styles.
Starting
with
factors,
the
Large
Growth
segment
rose
by
4.1%
while
Large
Value
declined
by
0.6%.
There
were
also
differences
between
large
and
small
companies,
with
the
former
gaining
a
combined
2.1%
in
January
compared
to
1.0%
for
the
latter.
Among
large
cap
growth
companies,
the
biggest
contributors
to
January’s
gains
were
ASML
Holding
NV
(ASML;
+17.1%
in
euros),
Novo
Nordisk
A/S
(NOVO
B;+11.0%)
and
SAP
SE
(SAP;+15.3%).
On
the
Large
Value
side,
Deutsche
Telekom
AG
(DTE;
+4.6%),
Volkswagen
AG
(VOW;
+7.2%)
or
AXA
SA
(CS;
+5.7%)
rose
strongly
but
could
not
offset
losses
in
some
of
the
companies
that
weigh
more
heavily
by
market
capitalization,
such
as
Shell
PLC
(SHEL;
-3.3%),
TotalEnergies
SE
(TTE;
-1.2%)
or
Rio
Tinto
PLC
(RIO;
-4.3%).
At
the
sector
level,
there
were
large
differences
in
performance
in
the
first
month
of
the
year.
The
biggest
gainer
was
the
technology
sector,
rising
8.1%.
We
have
already
mentioned
the
strong
performance
of
ASML
Holding
NV
and
SAP
SE
which
contributed
the
most
to
the
sector’s
performance,
though
Dassault
Systemes
SE
(DSY),
Capgemini
SE
(CAP)
and
ASM
International
NV
(ASM)
all
rose
by
more
than
9%
in
euro
terms.
Another
sector
that
did
well
in
January
was
healthcare,
thanks
to
Novo
Nordisk,
which
is
by
far
the
European
company
with
the
largest
market
capitalization
in
the
sector.
Other
contributors
to
the
sector’s
strength
were
GSK
PLC
(GSK),
up
9.8%
in
euros,
Novartis
(NOVN),
up
5.1%
and
Sanofi
(SAN),
up
4%.
Among
the
sectors
that
suffered
losses
in
January
were
utilities,
led
lower
by
RWE
AG
(RWE)
and
EDP
Renovaveis
(EDPR),
which
dropped
by
16.6%
and
18.8%
respectively.
Basic
materials
were
also
weak,
with
a
decline
of
3.4%.
Glencore
PLC
(GLEN)
fell
by
9.5%
in
euros
and
BASF
(BAS)
by
8.9%.
Regarding
valuations,
the
trend
remains
the
same:
value
is
more
attractive
than
growth
and
large
companies
are
more
expensive
than
smaller
companies.
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