Why are European markets underperforming?

Caused by three factors

Dispersion in world equity market returns has been marked since the start of the summer.

Emerging markets - and, to a lesser extent, the US - are clearly outshining European assets. This underperformance is all the more puzzling as all growth-related signals are positive and flashing green.  This underperformance can be traced back to three negative factors, which we do not expect to persist. First, the euro's appreciation has certainly been a drag. Measured against the US dollar, the euro is close to the highs the currency had reached in 2015. Of course, this tends to directly pressure corporate profitability.  Euro hits six-month high; Sterling falls Moreover, the...