INCORPORATING QUANT SIGNALS INTO EU EQUITY SECTOR AND STYLE STRATEGY

At the end of 2019 we published the Focal Point “Quant signals for EU equity sectors and styles” where we introduced our proprietary equity valuation tool to yield indications of over- or undervaluation for different sectors and styles of European equities.

Highlights:

  • We present an update of our proprietary equity valuation tool, based on quant models, which provides indications of over- or undervaluation for different sectors and styles of European equities.
  • Currently, among European equity sectors, financials, industrials, energy, staples and automobiles look undervalued while health care, utilities, materials and software appear overvalued.
  • Among European equity styles, undervaluation is indicated for large cap value and small cap while growth, value, quality, momentum, large cap and small cap growth look expensive.
  • That said, incorporating non-quant signals from our analyses, we recommend to overweight insurance, div. financials, media, telecoms and capital goods. Underweight durables, transportation, real estate, commercial & professional services and momentum.

Download the full publication below

INCORPORATING QUANT SIGNALS INTO EU EQUITY SECTOR AND STYLE STRATEGY

RELATED INSIGHTS

FIRST Q2 EARNINGS RESULTS SHOW POSITIVE SURPRISES. EXPECT LIMITED NEGATIVE REVISIONS
Growth (yoy) is clearly negative but the magnitude should deteriorate further (to be in line with expectations) as more firms will report in the next few weeks: the next two weeks will see the bulk of reported results.
NO ECB SUMMER SURPRISE THIS YEAR, GOVERNING COUNCIL WANTS AGREEMENT ON RECOVERY FUND
After having augmented the volume of the Pandemic Emergency Purchase Programme (PEPP) in June, the Governing Council did neither act nor announced outright action at today’s meeting.
CHINA’S GDP SURPRISED ON THE UPSIDE BUT DEMAND STAYED RATHER WEAK
China’s GDP rose by 3.2% yoy in Q2, after a Covid-19 related drop by 6.8% in Q1, according to data published by China’s statistical office this morning.