The country has been in the doldrums for so long that many investors have given up on it, so there are fewer people researching its stock market than is normal in London or New York, say. This lack of interest leads to pricing anomalies that would be picked up elsewhere, offering opportunities to those fund managers who do seek them out. This lack of interest has led to the market being lower than it should be and has also made it one for stock pickers, said Alexander Treves of Fidelity, who said there were attractive opportunities in the child care, health care, factory automation and energy-efficiency sectors. Hedge your bets As explained in our main story – ‘How to profit from Europe turning Japanese’ (on telegraph.co.uk/money) – the rise in Japanese shares last year coincided with a fall in the yen, reducing the gains for British investors.
Will Europe follow Japan and send its stock market soaring?
While the QE bloc of America, Britain and Japan is basking in recovery, the eurozone is still digging its way out of double-dip recession. The US economy outgrew the single currency area by three percentage points in 2012 and again in 2013, and will pull further ahead this year. The QE countries have deployed monetary stimulus to cushion fiscal austerity. This has been a success, even if it depended on stoking asset bubbles.
Stock Market Today: Tiffany’s Holiday and Infosys’ Strong Quarter
Infosys’ stock is up 3% in premarket trading. Finally, things aren’t as dire as many investors feared at Abercrombie & Fitch. The clothing retailer’s shares are spiking after it boosted its outlook for the holiday quarter last night. Down by just 6% through the holiday season, sales are tracking ahead of management’s expectations.
Beware of frothiness in the stock market
In my opinion, stocks are probably not to point of being overvalued or speculative, but certainly, it is difficult to make the argument that U.S. stocks are cheap. Does past performance for stocks tell us anything about future performance? Actually, it tells us that after a good year, it is best to be visit this page cautious (and after a bad year to be optimistic).