Europe Stocks Stage World-Beating Rally as Trade War Backfires

Europe’s equities have emerged clear winners worldwide as the region’s economic outlook brightens at a time when President Donald Trump’s trade war hobbles US financial markets.

Five months into the year, eight of the world’s 10 best-performing stock markets are in Europe, according to data compiled by Bloomberg. That list features Germany’s DAX Index with a rally of more than 30% in dollar terms, as well as peripheral markets such as Slovenia, Poland, Greece and Hungary.

The pan-European Stoxx 600 Index is beating the S&P 500 by a record 18 percentage points in dollars, powered by Germany’s historic fiscal ...