Is the tide turning for EU equities?

ON EUROPE

Last year we felt there had been events which constituted a decisive positive turning point for the fortunes of the eurozone.

A key determinant of our view was the collapse in 10-year government bond yields of peripheral countries.Events of recent months have reinforced our positive stance. The speed of response to the financial crisis in Cyprus and the willingness of investors to accommodate the initially inconclusive general election in Italy are noteworthy. We have also been greatly encouraged by the release of Q1 2013 fiscal data confirming that finally, the bitter medicine of recent years is beginning to pay off.  Greece achieved a considerably reduced budget deficit compared with its given target. The ...