European equities present a stark contrast in early 2026, with defense contractors and financial stocks soaring while consumer staples and healthcare names collapse. The divergence reflects shifting investor priorities amid changing economic conditions.

Fresnillo leads the pack with a staggering 436.4% 12-month gain, followed by Nebius at 202.2% and Endeavour Mining at 171.7. Financial stocks dominate the top performers, with Société Générale surging 153% and Banco Santander climbing 125.6% over the same period.

On the losing side, Novo Nordisk shed 47.9%, making it the worst performer among large European equities. Wolters Kluwer fell 44.9%, Diageo dropped 36.8%, and Pernod Ricard declined 32.9. Switzerland-listed names feature heavily in the underperformers list.

The market rotation has benefited commodities-exposed stocks, which gained 3.3% month-to-date relative to US-exposed stocks that lost 1.7%. Discretionary stocks were the weakest sector in Q1, falling 12.1%, while utilities outperformed with a 7.8% gain. Europe-focused equity funds have attracted $15.86 billion year-to-date, the strongest start since 2015.