European Stock ETFs Post First Positive Month Since the Iran War Started

European stock exchange-traded funds (ETFs) recorded a month of positive net flows in July, their first since the US-Iran conflict began in late February, according to Bloomberg data. The return of capital signals renewed investor appetite for the region. A strong earnings season and easing oil prices have restored Europes appeal as a hedge against volatile technology stocks. Investor Money Returns to Europe BlackRock highlighted that its European equities products attracted $4.4 billion in July. The asset manager described the flows as evidence of anti-momentum allocations away from volatile chipmaker stocks. A July sell-off in global semiconductor stocks had pushed investors toward regions less tied to technology and artificial intelligence stocks. Europe emerged as a favored destination. Europes stock market is firing on all cylinders and drawing money managers who say this rally will be more durable than just another short-term trade. Strong corporate results reinforced the shift. Companies in the Stoxx Europe 600 are on track for 22% year-on-year earnings growth in the second quarter, the strongest since 2022. Banks led the performance. BNP Paribas saw quarterly profits surge by a third, while UBS profits jumped 17% to a record, both driven by trading revenues. Banks Turn Bullish on the Rally Meanwhile, UBS raised its year-end target for the Stoxx 600 to 690 points from 630. Against Fridays close, that implies roughly 5% further upside. Goldman Sachs echoed the confidence in its August picks. The bank projects 168% upside for UK clean energy developer Ceres Power and 102% for German defense contractor Rheinmetall over 12 months. The Stoxx 600 has gained 10.7% in 2026 and touched a record 663.4 points this month. Germanys Dax, the FTSE 100, Frances Cac 40, and Spains Ibex also reached highs. Stoxx 600 Performance. Source: Google Finance Not every strategist agrees. Societe Generale expects the Stoxx 600 to fall to 600 points, while TFS forecasts a 9% decline to 585.