Asset managers turn bullish on European equities
Asset managers have upgraded their return expectations for European equities. They also believe the Trump rally in US equities has run its course.
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Asset managers have upgraded their return expectations for European equities. They also believe the Trump rally in US equities has run its course.
United Kingdom equities has been a remarkably resilient asset class as the winds of macroeconomic uncertainty have swirled around following the Brexit vote, but how long can this continue?
Today’s eurozone data certainly gives investors something to think about. Should the action that follows this thinking be a raising of your European equities weighting?
2016 was a year of radical changes: the most popular asset class of 2015 was the one sold off most heavily the next year.
As European equity indices finally showed signs of life in December, investors again started to commit money to the asset class. European equity funds saw their first net inflows in 11 months according to Morningstar data.
Suspicions have been raised about European bond scarcity, but rising yields and declining prices point to further volatility, said Julius Baer head of fixed income, Markus Allenspach.
European equities had been the fund selector favourite for years, but appetite is on a downward trend. Emerging market equities have now been more popular for three quarters in a row, and US equities are quickly catching up.
The surprise US election victory by Donald Trump has greatly increased uncertainty, yet asset prices are now back at similar levels as just a couple of days ago when a Clinton victory looked more likely.
Fund management companies expect the world’s highest returns over the next 12 months to be found in emerging markets. They have severely downscaled their return prospects for European equities over the past couple of months, apparently in response to the attitudes of their clients.
As the British government struggles to trigger an exit from the European Union, fund distribution heads at some of the biggest asset managers share their thoughts on the implications for their UK and European operations.
The ECB Governing Council again left monetary policy unchanged when it met on Thursday. It looks like the ECB is buying time to communicate to markets that it’s going to wind down its bond buying programme, albeit in an orderly fashion.
Selling European equities and buying global emerging market stocks is developing into the great trend of 2016.