GMA Viewpoint: Value in the Eurozone

Apr 2019

Almost a year ago, in May 2018, we discussed how U.S. value stocks were entering their twelfth year of underperformance compared with U.S. growth stocks. Value stocks in the U.S. had become much cheaper than normal compared to growth stocks and investor enthusiasm for growth stocks had been steadily building. But our conclusion was that a regime switch back to value from growth was not yet imminent (and had “another few quarters of underperformance ahead before the turning point,”) as the macroeconomic conditions still favored growth stocks, capital spending by growth companies was high but not yet excessive and investor enthusiasm for growth stocks was not yet euphoric.¹

Cyril Moulle-Berteaux

Head of Global Multi-Asset Team

Sergei Parmenov

Managing Director

Value in the Eurozone

¹Source: Morgan Stanley Investment Management, ‘Been Down So Long / It Seem Like Up to Me’, Global Multi-Asset Viewpoint, May 2018.

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