Barclays Cuts EU Small‑Cap Weight to Neutral

Barclays downgraded European small‑cap equities to neutral, citing slowing macro momentum and a more hawkish ECB.
Eurozone GDP nowcast fell to ~1.1% for 2026 Q1, down from 1.6% mid‑2024, weakening growth outlook.
Barclays trimmed Size exposure on April 10, cutting Growth and Size to add Value, amid negative small‑cap crowding near multi‑year lows.
Seasonal 0.5% monthly return expectation for small caps is overridden by the weak macro backdrop, per Barclays research.