This is at least the opinion of Blackrock strategist Martin Lück, whereby the performance of European stocks is fundamentally dependent on the development of the German EU presidency.
By taking over the EU Council Presidency, Germany has the opportunity to significantly influence the outlook for European equities in the second half of the year. According to Blackrock capital market strategist Martin Lück, Europe should remain an alternative for investors due to the sense of community it conveys. There must be a broadened mindset here, because the „my country first“ approach would leave the outlook for European stocks far worse. Investors might then ask why, apart from China and the US, they should also be invested in „that strange old continent that is on the sidelines“. This means that the German Council Presidency and Chancellor Angela Merkel also have a kind of Herculean task ahead of them, Lück said.
European equities have been upgraded from a previously neutral position to „overweight“. A cyclical upswing could benefit, as the region offers the „most attractive opportunity“, according to the Blackrock Investment Institute’s semi-annual outlook 2020. In justifying the downgrade of US equities to a neutral position, the authors write that there is a risk that fiscal support measures will expire and remain uncertain about the election.
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