European outlook still deteriorating as euro piles pressure on companies

The outlook for the European economy continues to deteriorate. The relative strength of the euro pu...

The outlook for the European economy continues to deteriorate. The relative strength of the euro puts pressure on the earnings of European companies competing in a global market. Economic data points to recession in the US and slowdown elsewhere. The extent to which stock markets have discounted this is open to debate. European markets have already suffered a severe de-rating, with trailing P/Es at 20-year lows. State Street global markets research suggests this discounts the worst earnings decline in 30 years. Equity market flows suggest it is time to look through the trough and ap...