July 3, 2020
AliExpress WW
European shares show the best quarter in five years

European shares show the best quarter in five years

AliExpress WW

A bull and a bear stand in the rain like bronze sculptures in front of the Frankfurt Stock Exchange.

AliExpress WW

Arne Dedert | alliance picture | Getty images

Euro Stoxx 600 closed its best quarter on Tuesday from March 2015, up 12.59% from the start of April.

Even after this rally, the pan-European blue chip index still closed at 13.35% for the year and completed the first half in the correctional area after the global spread of the coronavirus pandemic caused a historic sell-off in the stock market between late February and mid-March.

European stocks are still ahead of their American counterparts: the S & P 500 grew 19.95% in the second quarter and fell only 4.04% per year. However, some analysts are shifting the focus from the US to Europe, as the world comes out of months of blocking measures.

Scott Thiel, chief investment strategist at BlackRock, told CNBC on Tuesday that the investment giant has raised European stocks from “underweight” to “overweight”, partly due to “unexpected growth” in substantial monetary and fiscal policies. response on the continent.

The governments of major economies such as Germany, France and the UK have taken significant financial incentives to mitigate the expected effects of the pandemic, while the European Central Bank has now expanded its bond purchase program to 1.35 trillion euros (about 1.5 trillion dollars). ,

“What is happening in Germany, the EU Recovery Fund, the ECB’s actions, all these things were very powerful, plus when we look at the resumption of activity, we see a region that has been exposed to the virus,” Thiel said, adding that despite a serious outbreak at the beginning, large European economies have already begun to prepare for the opening.

In contrast, the United States continues to increase the number of cases where a number of states are currently re-introducing measures to block new cases and hospital admissions after record daily spikes, with more than 2.6 million people currently infected.

Thiel suggested that investors who are focused on US markets that have long been ahead of European competitors should see Europe as “an interesting way to play different ways of opening the economy and different ways of operating it.” pop up. “

Winners and losers

The shares, which showed the highest percentage growth during the second quarter recovery period, were the Swedish telecommunications and cloud communications platform Sinch, which, along with higher requirements for homework, also increased its shares thanks to the acquisition of Indian ACL Mobile in mid-June. Sinch closed the second quarter by 103% and grew by more than 178% for the year.

Dometic Group, the mobile life maker of compatriots who has fallen by more than 11% since the beginning of the year, is slightly behind 88% growth compared to the second quarter.

Meanwhile, the British manufacturer of miniature war games Games Workshop grew 85% in the second quarter, recovering March losses, ending growth by 31%. On June 12, the company raised its earnings forecast and said the recovery was “better than expected.”

At the other end of the European blue chip index, Spanish Banco de Sabadell fell 34% in the second quarter and fell more than 70% for the year, while French corporate bank Natixis posted a 21.6% drop in the second quarter and fell 41 % in a year.

Belgian insurance company Ageas, banking giant HSBC and British aircraft engine manufacturer Rolls-Royce completed the quarter with a drop of more than 16% and fell by 40%, 36% and 58% respectively this year.

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