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Investors warm to Europe as Joe Biden lead, virus fears rattle Wall Street

The US stock market has consistently outperformed Europe since the 2016 election of Trump, which was followed by a rally widely dubbed the 'Trump bump'.

June 26, 2020 / 22:29 IST
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European stocks look poised to make up ground on Wall Street in the second half of 2020 as Joe Biden consolidates his lead over Donald Trump ahead of the November US presidential election and a surge of new COVID-19 cases threatens the US economic recovery.

The US stock market has consistently outperformed Europe since the 2016 election of Trump, which was followed by a rally widely dubbed the 'Trump bump'.

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Fund flows suggest a shift in sentiment. Bank of America's latest weekly report on Friday showed $6.6 billion left US equity funds, the largest exodus in seven weeks, while $800 million made their way into European ones.

The pan-European STOXX 600 has outperformed world stocks by about 1.5 percent in the last month, while Wall Street's S&P 500 has underperformed by the same extent.