Is the eurozone at a turning point? The bloc’s GDP grew by just 0.1% in the fourth quarter of 2019, the slowest pace in almost seven years, says Elliot Smith for CNBC. Weak German manufacturing has weighed on wider performance and the coronavirus is more bad news for an economy where exports account for roughly 45% of GDP. Yet better survey data and sentiment indicators since the new year suggest that the slump could be bottoming out.
Fabio Balboni of HSBC points out that German wage growth has hit a 20-year high and unemployment is falling across the eurozone, so consumption could be in for a pick-up. That mildly positive outlook is buttressed by extremely loose monetary policy from the European Central Bank, which has cut interest rates and started buying bonds again last September.
For investors the most encouraging sign is a return to earnings growth. European businesses averaged around a 5% contraction in earnings per share during the first three quarters of 2019, according to Morgan Stanley. Yet the fourth-quarter earnings season looks encouraging, with earnings per share on track to rise 2.1% year on year.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
And there may be better news ahead. Germany’s January Purchasing Managers’ Index expanded at it quickest pace in five months, reports Michael Searles for City AM. Throw in reasonable valuations, and the region’s equities are hardly a write-off.
-
How to find lost pensions, savings or investmentsLosing track of money is easy to do when moving house or changing jobs so if you’ve lost touch with your cash, we outline some simple steps to find lost pensions, investments, savings accounts and Premium Bonds
-
Frasers Group 'is a rare retail gem in a battered sector'Opinion Frasers Group is shunned for a reason, but brave investors should buy in now, says Jamie Ward
-
Halifax: House price slump continues as prices slide for the sixth consecutive monthUK house prices fell again in September as buyers returned, but the slowdown was not as fast as anticipated, latest Halifax data shows. Where are house prices falling the most?
-
Rents hit a record high - but is the opportunity for buy-to-let investors still strong?UK rent prices have hit a record high with the average hitting over £1,200 a month says Rightmove. Are there still opportunities in buy-to-let?
-
Pension savers turn to gold investmentsInvestors are racing to buy gold to protect their pensions from a stock market correction and high inflation, experts say
-
Where to find the best returns from student accommodationStudent accommodation can be a lucrative investment if you know where to look.
-
The world’s best bargain stocksSearching for bargain stocks with Alec Cutler of the Orbis Global Balanced Fund, who tells Andrew Van Sickle which sectors are being overlooked.
-
Revealed: the cheapest cities to own a home in BritainNew research reveals the cheapest cities to own a home, taking account of mortgage payments, utility bills and council tax
-
UK recession: How to protect your portfolioAs the UK recession is confirmed, we look at ways to protect your wealth.
-
Buy-to-let returns fall 59% amid higher mortgage ratesBuy-to-let returns are slumping as the cost of borrowing spirals.
