U.S. stocks have underperformed compared to global markets, lagging the MSCI World ex-U.S. by 5% year-to-date, attributed to stretched valuations and a less dominant technology sector. Despite these challenges, earnings beats and growth differentials still favor the U.S. market. In contrast, European markets have surged by 12% since the 2024 U.S. Presidential Election, significantly outperforming the S&P 500's 3.5% gain. Investors are optimistic about Europe’s potential, viewing it as a viable alternative for diversifying into undervalued stocks, particularly as the European Stoxx 50 index has shown resilience since the election. Analysts suggest that while U.S. equities have historically outperformed, there is potential for Europe to close the return gap moving forward.