Using the Vanguard European ETF as a proxy (ticker: VGK), European stocks are up more than +16% since June 1 compared to +10% for the S&P 500:
And while it is obviously too early to declare an "all clear" on the euro zone economic woes, there is some evidence to suggest that some of the strong medicine administered by Brussels and Berlin may be working, according to an article in the German news magazine Der Spiegel:
The euro zone's crisis-hit countries are becoming more competitive, according to a new German study. Wage costs are down, and the countries are reducing their trade imbalances. Painful reforms appear to be slowly bearing fruit, and the euro zone might even return to growth next year....
Experts reacted positively to the new figures, saying that the crisis-hit countries are much further along with reforms than is generally believed. "The euro zone has already done most of its structural homework," Folker Hellmeyer, chief economist at Bremer Landesbank, told the Financial Times Deutschland. "The process of adjusting trade imbalances in the euro zone is in full swing," said Andreas Rees, an economist at the UniCredit bank.
The DIHK believes that efforts to make euro-zone countries more competitive will start to bear fruit in 2013. Likewise, the organization expects the euro zone to see growth of 0.7 percent in 2013, up from a 0.2 percent contraction in 2012, and predicts that Europe could even be a driver of global growth in the coming year. The expected uptick is also likely to benefit German exporters, the DIHK said, as 59 percent of German exports go to other EU countries.
http://www.spiegel.de/international/europe/german-report-crisis-hit-countries-have-become-more-competitive-a-852813.html
Borrowing costs in countries like Spain and Italy also appear to have stabilized, albeit at significantly higher levels than "safe" countries like Germany.
Pundits have had a field day for most of the past year projecting a collapse in the euro; what if they're wrong?
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