JPMorgan Strategist: Eurozone Stocks Will See New Buying Opportunities

Jin10 data reported on August 4th that JPMorgan strategists stated that after recent poor performance, Eurozone stocks will see another buying opportunity in the next 1-2 months. However, before that, the risk of stagflation needs to be “resolved,” the team led by Mislav Matejka wrote in the report, noting that Germany’s fiscal expansion is a “clear support,” trade negotiations have made progress, and natural gas prices remain low. The defense zone may experience profit pullback, but we recommend a structurally bullish view on the sector. Over the past few months, we have maintained tactical neutrality on the Eurozone relative to the U.S., but from a 1-2 year perspective, one should take advantage of the pullback opportunities in the SX5E to increase holdings.