Video - Is it too late to be investing in Europe?

Added Length:

June 2017 - Is it too late to be investing in Europe? with our expert Jean-René Ouellet

SUBJECT : Europe

EXPERTS : Jean-René Ouellet

VERSION: English

Note: The information in brackets "[...]" describes the visual and audio content of the video other than the dialogue or the narration.

[Jinggle music begins. The title ‘’Market Trends’’ appears in a honeycomb cell, then replaced by the video’s title: Is it too late to be investing in Europe? – June 2017. It all gives way to the Desjardins Securities logo.  These images give way to Mr. Jean-René Ouellet in an office. Behind him, we can see computer screens with stock quotes].

Jean-René Ouellet (MBA, CFA, Portfolio Manager, Portfolio Advisory Group)

Last quarter, we talked about investment opportunities in Europe. Since then, European stock markets have generated gains of 13% to 20% for Canadian investors. Excluding emerging markets, Europe has shown some of the strongest gains.

Despite this positive performance, the market is still trading at a discount compared to North American markets and offers attractive fundamentals. Not only are price-to-earnings ratios lower in Europe, but dividends are also higher. Economic growth is also stronger there. Profit margins are under less pressure because even if unemployment rates fall, they will remain somewhat elevated. Domestic demand is expected to remain robust. Finally, as predicted, a political landmine was avoided in the French election. The German election should go smoothly as well. In short, things are progressing nicely.

The weakest link in Europe, according to us, is Italy. Its banking sector requires more capital and an early election in 2018 could bring a Eurosceptic party into power. A degree of caution is required.

For now, we’re still recommending slightly overweighting Europe compared to our targets. But we’ll wait for a drop in prices, or at least a consolidation, before investing new money.

[The music begins again. The firm's logo  and the following notice appear on the screen: « This presentation is given for general information purposes. Desjardins Securities will not be held responsible for errors or omissions in the presentation. The information in this presentation should not be construed as legal, financial, accounting or tax advice. Desjardins Securities strongly recommends that you consult experts in those fields if necessary. Desjardins Securities and its directors, managers, employees and agents will not be held responsible for damages, losses or fees resulting from the use of information contained in this presentation. This presentation may contain statistical data cited from third-party sources believed to be reliable, but Desjardins Securities does not represent that any such third party statistical information is accurate or complete, and it should not be relied upon as such. All estimates, opinions and recommendations expressed herein constitute judgments as of the date of this publication and  are subject to change without notice. Desjardins Wealth Management Securities is a trade name used by Desjardins Securities Inc. Desjardins Securities Inc. is a member of the Investment Industry Regulatory Organization of Canada ( IIROC ) and the Canadian Investor Protection Fund (CIPF). ». Then the logo gives way to the website address. End of the video. ]

Back to top