In a dramatic shift, U.S. investors funneled nearly $10.6 billion into exchange-traded funds (ETFs) focused on European stocks during the first quarter—seven times the amount from a year earlier—according to data from BlackRock.

The surge in investment, driven by growing economic uncertainty in the U.S. due to President Donald Trump's tariff policies, has led to renewed enthusiasm for European equities. Tim Seymour, founder of Seymour Asset Management, has dubbed the trend Make Europe Great Again (MEGA), reflecting a sharp turnaround in sentiment toward the region.

Since Russia's invasion of Ukraine in early 2022, European ETFs had seen a net outflow of $6.4 billion, making this reversal particularly striking. BlackRock's Kristy Akullian highlighted the significance of the shift, emphasizing that for three of the last five years, investors had been moving funds away from Europe and into U.S. tech stocks.

However, investors are now reevaluating European markets, drawn by economic deregulation and major fiscal initiatives, particularly in Germany. ETFs like iShares MSCI Germany (EWG) have experienced record-breaking inflows, while defense-related funds have also gained traction due to increased military spending across Europe.

Despite this momentum, some analysts caution that sustained growth depends on stronger earnings performance from European companies. Meanwhile, not all regions are benefiting equally—ETFs investing in British stocks continue to see outflows, indicating uneven confidence in Europe's economic future.