European stocks face bearish pressure due to subdued GDP growth forecasts (1% for 2025) and geopolitical risks, including potential U.S. tariffs on EU goods. The STOXX Europe 600 index, currently at 511, has limited upside with a target of 530 (+4%) this year, reflecting constrained corporate profit growth and valuation concerns. Defensive sectors like healthcare and telecoms may outperform, but overall market sentiment remains cautious.