European Fund Managers Remain Upbeat About Earnings

Six out of 10 European fund managers say they believe corporate earnings to climb at least 10% in the next year, despite sinking stocks, and are worried about higher interest rates and slower growth, according to a Merrill Lynch survey.

Six out of 10 European fund managers say they believe corporate earnings to climb at least 10% in the next year, despite sinking stocks, and are worried about higher interest rates and slower growth, according to a Merrill Lynch survey. The poll also found that 55% viewed European equities to be undervalued, up from 35% in early May. “Upbeat on earnings, the majority believe that European equities are undervalued, and that value will be released through a monetary policy that is increasingly seen as over stimulative,” the Merrill Lynch report states. At the same time, confidence in the growth of earnings per share over the next 12 months has dropped from 69% in May to 45% in the current poll.