Broken downtrend

We are reading that we not the only ones to believe that European stocks are in for a period of outperformance against their US peers and to believe what we have seen over the last couple of months is only the beginning. In dollar terms, European equities have outpaced the US during three major periods since the 1980s, lasting an average of 3 1/2 years, according to Goldman Sachs strategists. Main arguments supporting the positive outlook from strategists are 1/ undervaluation with 13.1 forward PER against 18.4 times for the S&P 500 2/ more global exposure for European stocks with 60% of sales generated outside Europe 3/ brighter outlook for value sectors that dominate the European benchmarks like commodities and financials and 4/ more interest in European stocks after years of outflows. Needless to add that at ECP, we have a strong offering in European value stocks with a proven track record.