In less than three months, the U.S. stock market went from a decidedly bullish outlook to fears of a bear market and recession in 2025. The S&P 500 is down about 5% since Jan. 1, and it has given up all of its post-Election Day gains to plumb its lowest levels since September.
Only time will tell if this recent contraction for domestic markets turns into a prolonged downturn for U.S. stocks. But in the meantime, European stocks are booming, and many investors have started looking abroad for opportunity.
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The following seven leading European stocks all offer significant scale, along with insulation from U.S. market volatility and currency fluctuations:
| Stock | Market Capitalization |
| ArcelorMittal SA (ticker: MT) | $24 billion |
| British American Tobacco PLC (BTI) | $90 billion |
| Lloyds Banking Group PLC (LYG) | $54 billion |
| Nestle SA (OTC: NSRGY) | $260 billion |
| Nokia Corp. (NOK) | $28 billion |
| Sanofi (SNY) | $146 billion |
| Spotify Technology SA (SPOT) | $108 billion |
ArcelorMittal SA (MT)
Sector: Materials Headquarters: Luxembourg Market value: $24 billion
ArcelorMittal is an integrated mine and steelmaker that is a unique investment opportunity given the geopolitical environment. In the U.S., President Donald Trump’s tariffs prioritize U.S. steelmakers over foreign competitors, and the threat of retaliatory tariffs means that U.S. steelmakers will have big challenges selling to Europe going forward. At the same time, the war in Ukraine has caused a shutdown of any Russian metals coming into Europe, and China’s new inward-looking priorities amid tariffs also create supply bottlenecks. That leaves MT as the primary producer of steel for the continent, and as commodity prices remain elevated that has created a boon for business — and the company expects demand to increase this year. As a result, MT stock has gained about 39% through March 11.
British American Tobacco PLC (BTI)
Sector: Consumer staples Headquarters: U.K. Market value: $90 billion
Yes, after the Brexit vote it is fair to say the U.K. is technically no longer in the European Union. But geographically speaking, BTI is part of Europe — and while a considerable portion of revenue does come from North America, the majority of sales are booked outside the U.S. That makes this tobacco company a unique investment opportunity among European stocks thanks to the same reliable sales and massive dividend as U.S. stalwart Altria Group Inc. (MO) — but with a European regulatory regime and a separation from exchange-rate fluctuations in the U.S. dollar. While shares are up about 13% since Jan. 1, there’s still plenty of room for continued upside in addition to long-term stability.
Lloyds Banking Group PLC (LYG)
Sector: Financial services Headquarters: U.K. Market value: $54 billion
London-based banking and insurance giant Lloyds has surged about 30% this year and is up about 43% in the last 12 months, thanks to improving operations for the sector and much more favorable sentiment compared with U.S. financials. LYG may not be as recognizable to some U.S. consumers as big-time Wall Street financial firms, but it is on par with regional financials like M&T Bank Corp. (MTB) or insurer American International Group Inc. (AIG) in size — and with a history going back to 1695, it has a rich pedigree far older than any U.S. financial firms. With scale and a big dividend on top of recent outperformance, LYG is a top European stock to buy now.
Nestle SA (OTC: NSRGY)
Sector: Consumer staples Headquarters: Switzerland Market value: $260 billion
Founded in 1866 and one of the biggest consumer staples stocks on the planet, Switzerland-based Nestle is a reliable and profitable company and thus worthy of attention. Admittedly, the U.S. is a big market for this familiar company that makes Kit-Kat chocolates, Häagen-Dazs ice cream, Hot Pockets frozen foods and other products. But the stable nature of its consumer staples brands, along with a headquarters in Switzerland that insulates it from currency volatility, has made NSRGY quite attractive lately. As proof, shares are up about 23% since Jan. 1 to significantly outperform most other large-cap names in the staples sector.
Nokia Corp. (NOK)
Sector: Technology Headquarters: Finland Market value: $28 billion
While its iconic N90 smartphone was all the rage some 20 years ago, Nokia hasn’t exactly been at the forefront of innovation in the 2020s. But starting with the landmark Brexit vote of 2016 and accelerated by Russia’s invasion of nearby Ukraine and the protectionist stance of U.S. lawmakers lately, the European Union has prioritized home-grown providers of critical infrastructure in various industries. That means telecom hardware from Nokia has been increasingly in demand, as has its expertise in network infrastructure, cloud services and related technology services. The stock is up an impressive 42% over the last 12 months as a result of better performance, and improving sentiment in the region makes NOK a top pick.
Sanofi (SNY)
Sector: Health care Headquarters: France Market value: $146 billion
Paris-based Sanofi is a pharmaceutical leader that focuses on treating immune disorders, inflammation conditions, cancer and hepatitis. Size-wise, it’s comparable to familiar domestic names like Gilead Sciences Inc. (GILD) and Amgen Inc. (AMGN). Like the U.S., Europe faces a similar demographics tailwind that is boosting demand for health care services from an aging population. While a significant share of SNY revenue is booked in the U.S. from its treatments, its European headquarters link it to more favorable market sentiment and insulate it from potential U.S. dollar currency volatility. As a result, shares of this European stock are up an impressive 20% this year while many other U.S. health care stocks have lagged.
Spotify Technology SA (SPOT)
Sector: Communication services Headquarters: Luxembourg Market value: $108 billion
One of the top-performing stocks in Europe lately, if not the entire the world, is streaming music leader Spotify. In the years after its 2018 IPO, Spotify struggled to turn a profit despite its massive user base. But its executive team responded by rolling up their sleeves and getting serious, cutting costs and trimming Spotify’s payrolls as it refocused operations. The results have been tremendously successful, with SPOT posting year-over-year revenue growth of 16% for the fourth quarter, and gross margin and free cash flow both hitting records. Shares have soared about 100% in the last 12 months, and are up about 15% since Jan. 1 despite struggles for similar U.S.-based digital content firms.
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7 European Stocks to Buy Now originally appeared on usnews.com
