Wealth Manager - the site for professional investment managers

Register free for our breaking news email alerts with analysis and cutting edge commentary from our award winning team. Registration only takes a minute.

Three catalysts for European equities

In recent weeks the bear case for European equities has become more pronounced on the back of weaker-than-expected GDP data and deflation concerns. This softening in economic momentum has led some investors to question whether the ECB is behind the curve and indeed whether it has the requisite firepower in its armoury. We believe that these concerns have been overplayed by the market: European leading economic indicators are still largely stable and positive, whilst we also believe that there are a number of imminent catalysts which have the potential to be supportive for European equities.

Q2 GDP

Despite shrinking growth in Germany and a flatline in France, there is little evidence of a prolonged slowdown in Eurozone growth, albeit we have seen some moderation. Our proprietary real-time GDP indicators (which are made up of between 55-75 data points) are stable in countries such as Germany and Italy. More importantly, however, is the disconnect between GDP and Purchasing Manager Indices (PMIs), that should give reason for hope. Although Q2 GDP growth has been weak, the PMIs of Italy, Germany and Spain have all been in expansionary territory. We believe the reasons behind the weakness seen in Q2 can be attributed to ahead-of-consensus growth in European GDP in the first quarter. Of course, geopolitical risk has also played a part, particularly in relation to Germany.

Click here to read the rest of the article

Visit the Neptune European Opportunities Fund Page

Visit neptunebigideas.com for more market views and comment from Neptune.

Important Information

This is not for Retail Clients. It is intended for Investment Professionals and is not for forward transmission.

The value of an investment and any income from it can fall as well as rise as a result of market and currency fluctuations and your clients may not get back the original amount invested. Some information and statistical data herein has been obtained from sources we believe to be reliable but in no way are warranted by us as to their accuracy or completeness. References to specific securities are for illustration purposes only and should not be taken as a solicitation to buy or sell these securities.

Forecasts are not a reliable indicator of future performance. This Fund may have a high volatility rating and past performance is not a guide to future performance. Neptune funds are not tied to replicating a benchmark and holdings can therefore vary from those in the index quoted. For this reason the comparison index should be used for reference only.

These are Neptune’s views and as such this document is deemed to be impartial research. We do not undertake to advise you as to any change of our views. This is not a solicitation or an offer to buy or sell our funds. All information is given in good faith but without any warranty. Neptune does not give investment advice and only provides information on Neptune products.

This article was provided by Neptune Investment Management and does not necessarily reflect the views of Citywire

Citywire TV
Play Boutique tapes: my business will never be sold

Boutique tapes: my business will never be sold

In the final part of our four part series we discuss consolidation and whether it's getting tougher for boutiques to survive.

Play Boutique tapes: are top managers better off at small firms?

Boutique tapes: are top managers better off at small firms?

In episode three of our series, boutique bosses discuss whether the best fund managers are more likely to thrive at smaller firms.

Play Boutique tapes: if you want a Ferrari, you have to pay for it

Boutique tapes: if you want a Ferrari, you have to pay for it

In the second part of our four-part series, boutique bosses are asked how they can justify the fees charged by active managers.

Read More
Your Business: Cover Star Club

Profile: how this boutique beat the big guns of wealth

Profile: how this boutique beat the big guns of wealth

This small west country offshoot of a local IFA scooped a 2018 Citywire award from beneath the noses of the national challengers

Wealth Manager on Twitter