By The Sizemore Letter
Jeff Reeves and I take a trip around the world, giving our thoughts on American, European and Chinese equities.
From The Slant:
There’s a lot of frothiness right now in U.S. stocks as equities continue to push higher despite earnings and revenue remaining challenged.
Charles Sizemore, editor of the Sizemore Investment Letter, says he’s pretty neutral on U.S. stocks as a result. And that means it might be prudent to look overseas for opportunities right now.
A look at valuations in the U.S. stock market makes it clear that a lot of the “easy money has already been made,” Charles says. That’s not to say he’s bearish on the U.S., of course … just not impressed with the hope of continued upside.
On the other hand, Europe appears to be undervalued based on earnings. And more importantly, as the Federal Reserve cuts back on its stimulative efforts there is a chance that Europe will be the place investors look to for more central banking assistance. After all, says Charles, the Fed can’t get any looser with policy even if it wants to, while the ECB has more wiggle room in regards to monetary policy.
But what about China?
Well, China’s growth is still impressive at 7.5% annually based on recent GDP estimates … but that admittedly is much reduced from previous years and even expectations a few months ago. Charles says he is cautiously optimistic on the region after so much negativity has been priced in, but certainly not as optimistic on a China recovery as he is on a European one.
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