Zambia Set to Benefit from European Market Gains and China FDI Recovery

Lusaka, Zambia – European equities closed higher on Friday, December 19, 2025, with the STOXX 50 rising 0.6% and the broader STOXX 600 up 0.4% to a fresh record. The rally was driven by expectations of further U.S. Federal Reserve rate cuts next year and declining bets that the European Central Bank (ECB) will raise borrowing costs in 2026.

Heavyweight stocks led gains, with ASML up 1%, Novo Nordisk nearly 2%, and HSBC and AstraZeneca each gaining more than 1%. Cyclical and defensive companies, including Rolls-Royce, Prosus, Roche, Iberdrola, Shell, and Safran, also saw strong performance. In contrast, sportswear stocks underperformed after Nike reported weaker-than-expected margins, citing weak demand in China and higher tariffs. For the week, the STOXX 50 gained 1% and the STOXX 600 rose 1.6%, while the Euro Area Stock Market Index reached 5,758 points, marking an 18.43% increase from the same time last year.

Meanwhile, China’s foreign direct investment (FDI) continued to contract, though at a slower pace. In the first eleven months of 2025, FDI fell 7.5% year-on-year to CNY 693.18 billion, marking the softest decline since August 2023. November alone saw a sharp 26.1% increase in utilized FDI. Manufacturing sectors attracted CNY 171.72 billion, services received CNY 506.29 billion, and technology-related industries, including e-commerce, medical instruments, and aerospace, drew CNY 221.26 billion. Key investors included Switzerland, the United Arab Emirates, and the United Kingdom.

Analysts say the developments in Europe and China could have positive implications for Zambia. The stronger European equity markets may encourage portfolio inflows into emerging markets, while China’s renewed FDI and investment in technology and manufacturing could support Zambia’s copper exports and broader industrial growth. However, economists warn that the benefits will depend on domestic macroeconomic stability, effective fiscal management, and continued improvements in infrastructure.

Zambia’s policymakers and investors will be watching global market trends closely as the country seeks to leverage external opportunities to support economic growth and development.