More traditional stocks keep stock markets afloat
Financial markets/economy
Posted by MoneyController on 02.09.2024
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The markets already seem to have put the crisis of early August behind them: stock markets are recovering and, in some cases, breaking new records. It is perhaps surprising (but only to a certain extent) that it is not tech stocks (and more generally ‘growth’ stocks) that are driving the markets' comeback, but rather the more traditional “value” stocks.
As Vittorio Carlini points out in ‘Il Sole 24 Ore’, several indices have reached new records in recent days: the Msci World, but also the Dow Jones and the DAX. These indices are characterised by a strong traditional component, namely ‘value’ stocks. After all, Carlini continues, even the data for the S&P 500 provided by Bloomberg.
Comparing the S&P 500 value index and the S&P 500 Growth, the growth in total return performance of value stocks has been close to 8% over the past three months, while the performance of growth stocks has been almost 7%.
This phenomenon, however, is not only a US phenomenon: if you look at the Stoxx Europe 600, value stocks are also the best performers in Europe over the past twelve months. As Carlini writes, this is not surprising, since in Europe the ‘value’ component in the markets has greater weight than in the US.
Carlini's article concludes with an outlook for the coming months (speakers include Carlo Gentili, co-founder of Nextam Partners, and Carlo De Luca, head AM of Gamma capital markets). In the outlook for the second half of 2024, important elements emerge, such as the interest rate cut announced by the Fed, but also the uncertainties deriving from events with international implications (just think in this regard of the US elections in November).
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