Apollo's optimism about Europe is at a 20-year high. What's worth watching?

U.S. investment firm Apollo Global Management is more confident in Europe's investment potential than ever before in 20 years, Robert Seminara, head of Apollo's European division, said at the Bloomberg Future of Finance conference in Frankfurt.

"I think Europe has finally realized that it needs to invest. You see the German government really getting involved, and it's not just about money - it's a change in attitude, a willingness to help private capital really develop the market," Seminara said as quoted by Bloomberg.

The next wave of investment in the region will be driven by defense, infrastructure and green energy spending, says the head of Apollo Europe. The relatively shallow capital market in Europe, compared to the United States, creates additional opportunities for large investment funds, Bloomberg writes.

According to Seminara, Apollo is avoiding investments in artificial intelligence and the defense industry in Europe. Instead, Apollo is betting on companies that serve these areas. Specifically, in August, the fund announced the acquisition of cooling systems maker Kelvion, which has carved out a sustainable niche in the data center solutions market after restructuring its debt in 2019.

Apollo's investments on the continent are approaching $50 billion. Other recent major deals include a €3.2 billion ($3.8 billion) investment in a joint venture with German energy company RWE to expand the power grid. In June, Apollo agreed to co-finance the construction of the Hinkley Point C nuclear power plant in France with Electricite de France.

The European Stoxx 600 index has gained 9.3% since the beginning of the year. The Stoxx 600 had long outperformed the U.S. broad market index S&P 500 in 2025, but the U.S. market rally after the duty-related collapse in April put it in the lead. The S&P 500 is now 13% higher than it was at the start of 2025.

In early September, Goldman Sachs predicted that the Stoxx Europe 600 index would rise another 2% by the end of 2025 to about 560 points (now 555 points). According to the investment bank, the European equity market looks relatively inexpensive, with low investor participation, and the region's improving macroeconomic outlook creates the potential for capital inflows and price growth.

"The time to buy [European stocks] is approaching," JPMorgan Chase strategist Mislav Matejka wrote on Sept. 1. He pointed then to the recovery in Chinese stocks: China represents a key market for mining and automobile companies in Europe, as well as luxury goods makers. Matejka suggested that eurozone stocks could outperform U.S. stocks in the next month or two, despite another political crisis in France.

This article was AI-translated and verified by a human editor