A strong rebound in the eurozone

Despite its down-at-heel reputation, the eurozone is looking surprisingly sprightly.

Continental Europe has a reputation as a"bombed-out economic has-been", says TheObserver, so investors will be pleased to see thatit is looking unusually sprightly. Euro-area GDPincreased by an unexpectedly strong 0.6% in thefirst three months of the year.

That's the fastestquarterly pace since 2008 and leaves both the UKand America standing. The jobless rate has fallen to10.2%, the lowest since the peak of the euro crisisin 2011. Household consumption and businessinvestment appear to have more than made up for alacklustre global environment.

France did especially well, registering the biggest boost in consumption since 2004 and the highestbusiness investment in at least five years. Meanwhile, Italy's unemployment rate declined to athree-year low, fuelling hopes of an end to stagnation in the labour market.

Take US profitswith some salt

All companies must filetheir results accordingto Generally AcceptedAccounting Principles(GAAP). But the figure theylike to present investorswith, the so-called"adjusted" numbers, often contain a more generousinterpretation of one-offcharges, or other forms of"distracting propaganda".

Sometimes there areseveral versions; GeneralElectric, for example, hasover six earnings numbers.The gap between reportedearnings and the officialGAAP profits is nowaround 30%, accordingto Morgan Stanley thewidest it has been since2009. So investors inAmerican firms should takethe profit figures with ahefty pinch of salt.

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