“the economic environment is not particularly favorable for European small caps”, according to Goldman Sachs

Which analyst does not have a positive opinion on small stocks? If historically, they do better than the big ones, this has not been the case for years. The American investment bank Goldman Sachs notes that to date, 2024 is no exception, all regions combined.

And if in Europe, small caps have only underperformed large stocks by 4% since then, mainly because Granolas, the “mega caps” of the Old Continent, “have lost 7% since their peak in early September», comments strategist Lilia Peytavin. Indeed, “the macroeconomic environment is not particularly favorable for European small caps».

These 3 factors that weigh heavily

Firstly because despite the ECB, “bond interest rates remain high»and that «50% of small value debts are at variable rates“. Then, the sluggish growth in the Old Continent weighs heavily on small stocks, which are more cyclical and more manufacturing than the others.

Finally, “we think quite counterintuitively that the…