How Did Eurozone Investor Confidence Look in November?



Eurozone investor confidence

Eurozone (FEZ) (VGK) investor confidence has shown signs of further recovery in November 2016. The Sentix investor confidence index stood at 13.1 in November 2016 as compared to 8.5 in the previous month, beating the market expectation of 9. The Sentix investor confidence index is one of the leading economic indicators.

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Investor confidence index

The Sentix investor confidence index is based on the results of surveys of ~2,800 analysts and investors and shows investor sentiment toward business conditions. A strong performance from the index is a good sign for the Eurozone (EZU) (HEDJ) (IEV).

The index’s high numbers in November indicate that investor sentiment supported the Eurozone economy in November. The economy has faced various challenges in recent years. Low economic growth and deflation had been the major concerns, but now the UK’s (EWU) exit from the European Union is the central concern. In July, the index touched a record low of 1.7 after the announcement of the UK’s Brexit referendum results in June 2016, and policymakers are now thinking that the proposed exit from the EU (EZU) (IEV) will be a “hard Brexit.”

Still, the index has recovered from its record lows, which signals that confidence in the economy is improving. Alexander Dryden, a global market strategist at J.P. Morgan Asset Management, spoke about his bullish views on Europe on Bloomberg Television, stating that Europe’s economic indicators are changing. Improvement in domestic consumption and retail spending could drive growth in the economy.

In the next part of this series, we’ll look at the performance of the US consumer price index for October 2016.


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