uploads///Returns of Europe focused Mutual Funds for October

Ten Europe-Focused Mutual Funds and Their Key Indicators


Nov. 24 2015, Published 12:55 p.m. ET

Eurozone economic growth

In a world that seems to be slowing down, the Eurozone’s economy is following the trend. Information released on November 14 showed that economic growth in the Eurozone stood at 0.3% in 3Q15, compared to a 0.4% pace in 2Q15. In light of the economy continuing to receive stimulus, this number is disappointing. Even though France began to grow, rising by 0.3% in 3Q15 compared to no growth in 2Q15, Germany and Italy slowed down.

A fall in exports has been the major reason for the Eurozone’s slowdown. However, the silver lining is that consumer spending has remained upbeat. This is a positive sign as spending forms a big component of economic output, and in times of global economic distress, becomes vital to an economy.

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Inflation remains subdued

Data from Eurostat showed that inflation in the Eurozone rose 0.1% in October from a year ago, after falling at the same pace a month ago. Energy prices, impacting companies like Total (TOT), Royal Dutch Shell (RDS.B) and Eni SpA (E), have been primary drivers for inflation. On a positive note, core inflation—that excludes energy, food, alcohol, and tobacco prices—was 1.1% in October, up from 0.9% in the previous two months.

A fall in energy production has impacted the region’s industrial output as well. However, a rise in demand for durable goods may help companies like Luxottica Group (LUX), and has in fact helped reduce further falls in production.

Impact on Europe-focused mutual funds

As is visible from the graph above, Europe-focused mutual funds (IEOAX) (UBPIX) had a good October.

In this series, we aim to analyze the performance of Europe-focused mutual funds. We’ll see how they’ve fared across periods and why so. In the final part of the series, we’ll try to draw up a composite picture for all who are either invested or are thinking about investing in Europe via the mutual fund route, taking into consideration the macro picture drawn here.

We’ll begin our analysis with the Invesco European Growth Fund Class A (AEDAX).


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