A broad measure of European shares, the STOXX 600 index (.STOXX), is trading at 14-month highs, taking this year's gains to almost 10%. James Rutland, a European equities fund manager at Invesco, noted that consistent outflows from European shares last year, when the energy crisis dealt the region a fresh blow, had left valuations at very cheap levels. A broad index of European stocks is trading at a multiple of 12.6, compared with a ratio of 18.1 for the S&P 500, according to Refinitiv data. This 5.5 point premium is above the five-year average of around 4 points, suggesting European shares look cheap compared to their U.S. counterparts. "This has broken European stocks out of their relative downward trend, so we don't think Europe is now a structural underperformer," he said.

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