Another risk is that the ECB wrong-foots markets in some way by failing to meet expectations on its QE programme and other support measures.
There is also the big problem which has always been present with European equities as an asset class and is particularly acute now. Namely, that ‘European’ is a very broad term which can mean very different things from an investment point of view depending on which countries within Europe are being targeted.
Despite the best efforts of EU politicians, bureaucrats and central bankers, the economies and equities markets of the various nations continue to have large differences between them.
The nuanced situation being what it is the perennial argument for active over passive management seems stronger than usual in the case of European equities. Careful stock picking could be the order of the day rather than an a one size fits all approached.
