The market has been very concerned about the economic slowdown and geopolitical issues in Europe - obviously Brexit being the biggest, most significant one. Show More
European banks
During the last quarter US economic strength led market sentiment, resulting in a widening valuation gap between the US market and the rest of the world. This widening gap implies a much more favourable backdrop for long-term returns outside the US. Expectations of non-US countries are not only lower, but... Show More
Despite political tension and underperformance of the European Financials sector in the June quarter, results in 2017 and the first quarter were solid. We saw upgrades for the European banking sector through 2017 on the back of improving loan losses and continued uptick in lending growth. The banks are also... Show More
German equities recovered some ground early on Monday as the government coalition between Angela Merkel’s Christian Democratic Union (CDU) and Germany’s Social Democratic (SPD) party was approved by SPD members over the weekend. Show More
The global banking sector has been undervalued since the financial crisis. However central banks are starting to increase rates and this should be positive for the sector as it will enable banks to make money out of the liability side of their balance sheet. It is hard to make any... Show More
We know Europe has been through a touch economic cycle over the last few years since the GFC. That's somewhat on the mend now. Once the European earnings come through, the markets will start to appreciate that and reward those stocks - both with a re-rating as well as seeing... Show More
I recently attended the Bank of America Merrill Lynch 22nd Annual Financials CEO Conference in London. With financials being such a large weighting in global, and local, equity indices and the interest rate cycle turning up, attending this conference has given me genuine insight into the prospects for UK and... Show More
After eight years of falling interest rates and quantitative easing, most investors are wondering how long before the next great fall and when it will happen, mostly so they can dump their shares and avoid the pain suffered during the GFC. Show More
The European Union (EU) has often been described as an economic impossibility, however a conclusive and over-looked fact remains, that since the birth of the Euro, the EU has produced a better growth outcome than the US and Japan (Chart 1). Show More
Spanish banks have until recently been an attractive way for investors to play regional economic recovery and rate normalisation. The real estate market in Spain is in recovery mode and prices remain significantly below pre-crisis peak levels (unlike many other countries, including Australia). Domestic Spanish banks generally remain highly leveraged... Show More
