Credit Suisse raises UK equities to 5 percent overweight, citing better economic and earnings momentum than global peers.
The broker says in a note that it keeps continental European equities holding at 13 percent overweight as the region “has the best economic momentum of any region and less aggregate leverage than the U.S., the UK and Japan, while concerns over the euro and fiscal tightenting are overstated.”
It downgrades Japanese equities to benchmark, saying the Japanese equity market “typically underperforms four months after lead indicators peak,” though it increase its overweight on Asia excluding Japan to 25 percent from 20 percent.
“We believe the next two years will be about balance sheet concerns — and private sector, banks, government and central bank balance sheets all look in much better shape in the developed world,” Credit Suisse analysts say.
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