Weekly newsletter 17 November 2015- In the current uncertainty, what are good markets to invest in?
ECB hinted last month that they are prepared to extend their quantitative-easing program in December. Equity markets historically react positively to this news. US equity market has risen significantly the past years based on the FED stimulation program.
The euro is forecasted to weaken against the dollar the coming 12 months, because of ECB decision (more money supply) and because the FED is most likely going to increase the interest for the first time in a decade. When the euro gets weaker, it will strengthening the export in Europe. Europe is exporting more products than importing and therefore it will be overall a positive sign for more growth.
Why European equity markets deserve a second look
A number of current factors are positive for European growth, but the investment consensus would seem to be ignoring them, leading to significant undervaluation of Eurozone equities. Paradoxically, this puts the Eurozone in the position of being most unlikely to disappoint the market. Indeed, most of the likely growth outcomes would recast the market view of Europe and effect a positive transformation on the valuation of equities.
- ·lower commodity prices,
- a lift to exports and earnings from the weaker euro,
- a wave of corporate restructuring and reform that ought to deliver better margins and,
- Finally, a policy stance from European institutions and governments that is generally positive for investors. Read more:http://www.pionline.com/article/20150402/ONLINE/150409971/why-european-equity-markets-deserve-a-second-look
European stocks rise sharply, Greek shares surge after deal
17 European shares rose sharply on Tuesday 17 November, helped by encouraging updates from companies such as Germany's United Internet and Dutch-based Randstad , the world's second-biggest staffing company.
Sentiment was also improved by the latest comments from an executive board member of the European Central Bank, and by Greece's preliminary deal with its international lenders on home foreclosures, analysts said.
Posted on Tue, November 17, 2015
by Simon Snelder filed under