Europe: Block trades in European stocks off to best start since 2021

Block trades in European-listed companies had their best start since 2021 in the first two months of 2025, defying subdued enthusiasm for initial public offerings (IPOs), according to Bloomberg data.

The source cited mentions that some $8.6 billion in shares of selected European companies have been traded since the start of the year, up more than 70% from the same period in 2024. The momentum is likely to continue amid record stock prices, according to Bank of America (BofA).

The surge in block trading activity comes as Europe's benchmark stock index, the Stoxx 600, is off to its best start since 2019, outperforming its U.S. peers.

"The correlation between market sentiment and block trading activity is usually clearer than in the case of IPOs," Jerome Renard, head of European capital markets at BofA Paris, said in an interview with Bloomberg, adding: "In this improved environment for European markets, accelerated placements - the segment most closely linked to secondary market performance - will continue at a robust pace."

According to the list of major block deals, Pfizer Inc. sold a 2.5 billion pound ($3.2 billion) stake in Haleon Plc in January, while Reinet Investments SCA sold a 1.22 billion pound investment in British American Tobacco Plc. Last month, Siemens AG completed a deal to sell 1.4 billion euros ($1.5 billion) worth of Siemens Healthineers AG shares.

The pan-European Stoxx 600 index hit a new high in early February, posting gains of more than 9% so far this year. Weekly flows into regional funds rose to their highest level since February 2022, according to BofA, which cited EPFR Global data.

Meanwhile, the region's IPO market has had a mixed start to 2025, with some participants facing difficult debuts, according to the source cited.

"While investors are eager to put capital in and analyze new deals, some prefer to stay on the sidelines for a while, analyzing how IPOs actually play out," Renard said, concluding: "Overall, the investor base remains selective, with some still in a wait-and-see mode."