24 April 2017

French Election: Is populism already passé?.

Relief rally follows 1st round vote which puts Le Pen against a moderate

If last year was the year investors were caught out by misleading polls, today’s market action suggests that investors are being caught out by mistrusting them. A collapse in near-term euro volatility, sharply higher equity markets and a compression in the spread between French and German government bonds emphasises the relief that Le Pen was not in a run-off with a far left-wing candidate.

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5 December 2016

You can’t be given a bloody nose twice.

Relief rally follows 1st round vote which puts Le Pen against a moderate

If last year was the year investors were caught out by misleading polls, today’s market action suggests that investors are being caught out by mistrusting them. A collapse in near-term euro volatility, sharply higher equity markets and a compression in the spread between French and German government bonds emphasises the relief that Le Pen was not in a run-off with a far left-wing candidate.

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Sector report cover
28/04/2017
Equity strategy and market outlook - April 2017

In this month’s strategy piece, Alastair George finds that equity valuations are above average across the UK and Europe, and exceptionally high in the US. The combination of high valuations and price momentum accelerating to the upside, but concentrated within a narrow range of digital stocks, is starting to feel like the ‘financial instability’ the US Fed has been keen to avoid. He remains cautious and believes developed market equity valuations appear to price in a sustained period of strong economic growth, which is at odds with expectations in the bond market. However, an overvalued market does not exclude the possibility of attractive stock-specific or event-driven situations – which, in turn, are relevant to the debate that currently favours passive over active management.

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