ING Private Banking & Wealth: Volatility Normalization & European Capital Deployment (with Tom Keene, Paul Sweeney)

Anouk argues that volatility is becoming normalized, with clients increasingly resilient. While Europeans initially rotated capital out of the US, strong US earnings (20% growth vs 10-15% for Europe) have reaffirmed US equity dominance. Europeans are now investing more but retain a home bias. AI-driven supply constraints (compute, power, labor) are inflationary in the near term, but could become disinflationary later.

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Commercial Bank $728.00B
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ING Private Banking & Wealth: Volatility Normalization & European Capital Deployment (with Tom Keene, Paul Sweeney)

ndx

US earnings growth of 20% is expected, driven by US companies and AI champions. Europe is keen to deploy capital into US AI.

rut

European clients are starting to invest more and show home bias, but US outperformance is dominant. Small caps could benefit from European capital deployment, but not explicitly mentioned.

Asks about the conversation with clients given geopolitical uncertainty (Iran, Ukraine).

Tom Keene
Anouk

Volatility is becoming normalized; clients are increasingly resilient and steadfast in their convictions.

Market reactions to shocks have been decreasing: -30% post-COVID, -20% post-Ukraine, -15% post-Liberation Day, -10% post-Middle East conflicts.
Asks if the rotation out of US into Europe is still the prevailing sentiment.

Paul Sweeney
Anouk

US earnings bonanza (20% growth expected) has reaffirmed US equity dominance over Europe (10-15% growth). Europeans are investing more but retain a home bias.

Europeans are starting to invest more (trillions in deposits), but the average European household has less than a third of wealth invested vs over half in the US.
Asks if Europe is leaning into America into 2027.

Tom Keene
Anouk

Europe is pro-US and constructive on US growth, but doesn't want to neglect its own continent. Supply is the new demand (compute, data centers, AI).

Europe is keen to deploy capital into US AI champions, but also wants to develop its own markets.
Asks if an end to the Middle East war could bring a surprise disinflationary tone.

Tom Keene
Anouk

A ceasefire could bring back the disinflation path, but AI will likely be inflationary before deflationary due to supply shortages (power, compute, labor).

Supply shortages have an inflationary edge, even if the conflict settles.

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