Strategists of investment bank JPMorgan forecast further decline in eurozone shares, Bloomberg writes. In their opinion, it is too early to open long positions on eurozone shares against their US counterparts.
“We believe that there is another stage of backwardation ahead,” the experts noted.
Experts expect further weakening of the European economy, citing the likely continuation of policy tightening by the central bank and other factors. The next step “down” may be caused by lower bond yields as well as earnings disappointment.
After a 36 per cent rise in dollar terms between October and April, eurozone equities have pulled back by more than a third – mainly due to a surge in US stock markets driven by the capitalisation of large technology companies. In July, stocks recovered somewhat, helped by dollar weakness.
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