Despite some emerging evidence that Europe's economic prospects may be stabilising, the direction of the region's equity markets remains determined by extraneous factors, notably the progress of ongoing US-China trade negotiations.
The beginning of May saw Q1 European GDP reported at a marginally better-than-expected 0.4%, while eurozone unemployment fell to a multi-year low of 7.7%. The Q1 corporate reporting season, which is drawing to a close, has also been relatively reassuring in terms of the outlook for 2019, although corporates are typically guarded this early in the year in terms of full-year guidance. Despite this, European equity markets have sold off from recent year-to-date highs and once again appear to be offering reasonable value on a relative and absolute basis, on a forward P/E ratio of 12x and...
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