European exchanges will continue underperforming the U.S., according to a new report from Oppenheimer that dwell ons the firm’s bullish U.S. outlook.
Markets in the U.S. have seen volatile swings during the defunct month and a half, but they’re still outperforming European equity retails. Stocks in Spain and Germany are in correction territory, and the FTSE 100 measure is coming off its third negative week in four.
Oppenheimer’s head of specialized analysis, Ari Wald, said several key factors prompt him to choose U.S. caches over those in Europe. Here are his reasons why.
• Europe’s latest nervous breakdown relative to the S&P 500 confirms Oppenheimer’s recommendation in going overweight U.S. neutralities.
• Europe’s underweight position in technology stocks has been a central grounds for this underperformance. For instance, the Euro Stoxx 50 has a 7 percent substance in technology, compared with the S&P 500’s 25 percent.
• Oppenheimer extends a long-term bullish outlook on technology, and in this environment the firm wooes difficulty in Europe outperforming.
Bottom line: The U.S. will likely at to outperform European markets due in part to the lack of technology market slice in Europe, according to Oppenheimer.