The Eurozone macroeconomic environment has steadily improved, with a significant uptick in manufacturing and services PMIs over the end of 2016. Eurozone growth may continue to pick up speed ahead after the European Central Bank revealed increased loan demand and easing of terms and conditions on new loans to help stimulate the economy.
“Investors loved Europe going into 2016. VGK traded in the red throughout 2016, with low points around the negative 10% and 15% year-to-date marks. Coming into this year, and in the wake of the surprise Brexit vote, Europe was out of favor. But VGK has been in the green throughout 2017, taking out its 2015 close at $49.88 in mid-March. And the ETF is currently outperforming the SPX,” adds Schaeffer’s.
Market analysts have upwardly revised their projections on Eurozone markets as a weakening euro currency, stronger global demand and steepening yield curve help support revenue growth, potentially signaling a turn in the prolonged earnings recession.
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