Salient to Investors: European companies most dependent on revenue from Spain, Italy, Greece and Portugal are rising in the stock market at the fastest pace in five years, providing chances for short sellers after two earlier rallies fizzled. Bears cite Spanish unemployment surging to a record, austerity measures pushing Italy into
READ MORE... →Salient to Investors: Arnaud Scarpaci at Agilis Gestion said earnings have been positive, and Europe is recovering – all is functioning in the micro-economy. 54 percent of Stoxx 600 companies so far reporting have exceeded analysts earnings projections. Matthieu Giuliani at Banque Palatine said catastrophe in Greece has been avoided, but the problem is no growth, so have
READ MORE... →Salient to Investors: Graham Bishop at Exane BNP Paribas said equities will advance in 2013 as investors who missed this year’s gains try to chase the rally, driven by a reversal of investor pessimism, near-zero US interest rates, accelerating economic growth, and favorable market valuations. Bishop said this phase of the cycle supports a strong
READ MORE... →Salient to Investors: Masaru Hamasaki at Toyota Asset Mgmt said: Investors expect further BOJ stimulus but are also losing hope that big enough steps will be taken. Japanese shares are outperforming versus overseas markets because the yen’s strengthening trend has eased. The 2 percent growth of US GDP was certainly good as the headline,
READ MORE... →Salient to Investors: The Stoxx 600 is at 12.3 times estimated earnings, its highest multiple since December 2010. Peter Garnry at Saxo Bank A/S said the divergence in the purchasing managers’ index figures between France and Germany shows that Europe is diverging into an A and a B team, with France joining the B team
READ MORE... →Salient to Investors: The S&P 500 is at 14.9 times reported earnings versus the average 16.3 multiple since 1954. Michael Price at MFP Investors says the U.S. is the most attractive stock market because of the strength of corporate balance sheets, low interest rates and valuations. Price said it’s very early for European stocks. Read the
READ MORE... →Salient to Investors: Net buying of long-term U.S. equities, notes and bonds totaled $67 billion during July versus $9.3 billion in June. Guy LeBas at Janney Montgomery Scott says European investors bought Treasuries et al to protect against deterioration in the euro financial markets, and this will continue into August. China holdings of U.S. Treasuries in July rose $2.6
READ MORE... →Salient to Investors: Fund managers are increasing holdings in Spain, Italy and Germany. Bank of America said 45 percent of fund managers believe euro-zone shares are undervalued, the highest for any region since at least 2001. The Euro Stoxx 50 has dropped 30 percent from February 2011 to 0.93 times book value,
READ MORE... →Salient to Investors: Global investors are buying emerging-market debt and shares of well capitalized companies. Anne Richards at Aberdeen Asset Management likes balance sheet strength, says many European equities are high risk and U.S. Treasuries are overvalued. Richards says investors are underestimating the health of Asian issuers – Likes Indonesian sovereign debt, Latin American
READ MORE... →Predictions: Bill Gross said: It will take economies and financial markets decades to normalize after the debt crisis, keeping U.S. securities the safest bet for investors. This is an authentic debt crisis and can only be ultimately cured by default or printing more money to inflate it away. A debt crisis can’t be cured with more debt
READ MORE... →