Is Europe's economic and corporate recovery on track?

An improving performance trend for European assets versus US assets is a key theme investors should be focusing on currently, says Toby Vaughan, head of fund management - global multi-asset solutions at Santander Asset Management UK

The environment for financial markets (both bonds and equities) has been supportive over the past few years, and this is not surprising given the key ‘ingredients' necessary. We have been in an improving fundamental backdrop (economic growth and corporate earnings), growth has largely been non-inflationary, volatility levels have been contained, monetary policy has been highly supportive, with the additional kicker of attractive valuations in equities. Many of these key factors remain in place, but to a lesser degree. The fundamental backdrop remains strong and policy accommodative, but ...