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Morgan Stanley analysts made Europe the best performing region in the world in the second half of the year and chose stocks to negotiate the recovery.
“We think there is a good chance that Europe is outperforming all major regions this year for the first time in a calendar year since 2000,” its analysts said in a research note released on Sunday.
Morgan Stanley expects global markets, including the United States, to be more “choppy” throughout the summer due to rising inflation, pressure on corporate margins and a possible slowdown in quantitative easing put in place to revive the economy. He said there was a “compelling” argument for Europe to outperform due to more attractive valuations, stronger earnings per share growth and the launch of the massive EU stimulus fund after Covid .
He selected more than two dozen European stocks that have a strong international presence, but which trade at a discount to their global peers.
Morgan Stanley’s picks include: