BofA raises its annual outlook for European stock indices

BofA Global Research has raised its forecast for the STOXX 600 index, predicting it will reach 530 points by the end of the year. This outlook is based on global economic stability associated with the conclusion of a trade truce between the US and China.

According to the Wall Street brokerage firm, European stocks remain near historic highs despite the global trade conflict and escalating tensions between Israel and Iran. BofA attributes the stability of the region's stock market to the fact that geopolitical events have not yet led to a clear slowdown in global economic growth.

However, the broker's updated target price for the STOXX 600 still implies a decline of nearly 1.1% from last Thursday's close of 535.86 points. The US-China trade deal and the US inflation report for May positively impacted financial market sentiment. Still, BofA expects US tariff policy and escalating tensions in the Middle East to continue weighing on the global economy.