In which Goldman Sachs (GS) Asset Management chairman Jim O’Neill segues roughly from European Championships to European equities:
Perhaps this is how Dutch people should think this weekend as they face the challenge of having to beat Portugal by a comfortable margin in their last group game next week. If they lose, they are on their way home. And, even if they do win easily, they will need to rely on Germany beating Denmark.
Next week, I am hosting a GSAM client call with the head of our European Equity team on the above title, where I will merely point out that, using the most conservative valuation techniques you can think of, European equities appear to be rather cheap. On the so-called CAPE (Cyclically-Adjusted Price to Earnings ratio) method, some Club Med countries are now at staggeringly low valuations, with Italy and Spain both more than 70 pct below their long term average.
Greece-Russia to Grexit:
Will Greek people vote for the more centrist parties this weekend? Will Greece pull off two major surprises next week, and (1) beat Russia in football, and (2) cause a rally in European markets? I don’t know the answer to either, but it would be rather nice. The nation needs a lift.
Anyway, could make a nice bit of half-time reading! Go here for the whole report.
