Breaking Up Is Hard to Do
For all its flaws, the Eurozone is currently more beneficial than costly to member countries, and thus it is very unlikely the euro will break up anytime soon.
Europe
Assessing European Investment-Grade Credit
While current yields and spreads over government bonds make euro-denominated investment-grade credit a potentially viable option, investors should also recognize that this market may be less attractive than others, such as the US$-denominated corporate sector, which offers higher absolute yields and presents fewer uncertainties.
The Worst of Times—Or the Best of Times
Investors should move toward benchmark weights in U.K. and European equities based upon good valuations, but the near-term outlook remains problematic given poor economic conditions and earnings that have not yet corrected from cyclical highs.
U.K. Property: Still Not Cheap
While prices have fallen sharply over the past year, the sector still faces stiff headwinds from high valuations, a weakening economy, and tightening credit for buyers.
European Equities: Lower Prices, But How Much Value?
Despite moving into the fair value range, European equities are not attractive at this time.
The Evolving U.K. Equity Market
Exposure to global mining and energy firms continues to ramp up.
The Implications of Falling U.K. House Prices
While a large segment of the U.K. equity market is exposed to direct of knock-on effects of house price declines, this is not reflected in current prices.
European Consumer Prices Set to Rise?
The European Central Bank has been far less hawkish than advertised; as a result, Eurozone prices may rise faster than most expect.
Taking Stock of U.K. Dividends
While U.K. dividends seem likely to hold up reasonably well in coming years, low dividend yields and the ailing financial sector are likely to limit the protection afforded investors in the event of a market downturn.
Structured Products: Buyer Beware
While structured products may benefit investors that seek principal protection or have a differentiated view from that of the market, they are not normally the best investment choice due to their high costs and complicated structures.