Perspectives Blog

European equities – Should investors care about periphery vs. core anymore?

Dan Ison, Portfolio Manager | January 13, 2014

…mers while France, UK and Italy were the worst. Four years since the start of the Euro Crisis (Greece late 2009), can we finally stop worrying about the periphery versus the core?  Year-to-date performance (in euros) Source: Threadneedle International Limited*, December 2013. Past performance does not gurantee future results. What can we glean from last year’s equity market performance? On the face of it, not too much. What is certainly true is…

Income inequality, disinflation and profit growth – the role of globalization

March 10, 2014

…firms outside the United States (shown in Exhibit 2) has risen from less than 1% of GDP to around 2.5% of GDP. Exhibit 2: Profits generated outside the U.S. by U.S. firms as % of U.S. GDP Source: Bureau of Economic Analysis, Threadneedle, September 2013 The economic, policy and investment implications are profound but also familiar. With citizens of EM a good deal poorer than their developed market neighbors, and with a slow convergence in polit…

Quality milestone in the European recovery story

March 17, 2014

Business, economic and political news all point to a strengthening recovery in Europe. We foresee a period of low inflation and low interest rates in Europe. We favor domestic European plays over internationally-exposed stocks, with an overweight stance in banking and telecoms. By Paul Doyle, Head of Europe ex. UK equities and Frederic Jeanmaire, Fund Manager, Threadneedle Investments After 18 consecutive negative months, the flow of eurozone…

Comments on the effect on global markets from the Ukraine crisis

Mark Burgess, Chief Investment Officer, Threadneedle Investments | March 12, 2014

To date, the fallout from the Ukrainian crisis has been largely confined to the emerging market debt, emerging market equity and commodity markets. At current levels, emerging market local currency debt appears to offer value, although we expect both the hard and local currency markets to remain volatile in the short term. Emerging equities reflect concerns not only around Russia and Ukraine but also the weaker growth outlook in Brazil and China…

An improving outlook for European equities

Philip Dicken, Head of European Equities, Threadneedle International Ltd | October 18, 2013

Economic data confirm that the Eurozone has exited recession. There are signs that corporate transactional activity is increasing as businesses become more financially secure. While Europe remains beset by challenges, the economic background is improving, valuations are looking more attractive and investors who have not been paying attention to European stocks may want to take a closer look. According to Eurostat, the 17 eurozone member states…

Inflation consternation

Martin Harvey, Fund Manager, Threadneedle International Ltd | November 5, 2013

An inflation slowdown in the Eurozone has prompted calls for central bank action, as reduced liquidity coupled with euro strength threatens the recovery. The expectation of imminent easing by the ECB should assert downside pressure on yields, and lead Bunds to outperform other markets. It is uncertain whether the ECB will act this week; we think any intervention is likely to be verbal, at least at first. October inflation in the eurozone slowe…