Key points from this week’s report:
Please refer to the attached PDF for the full report.
- We are yet to see a follow-through day on the Stoxx 600. Majority of the indices in Europe are in a Rally Attempt. European Equities had a muted week, with most ending flat on a close-to-close basis. Most majors have held their support levels and key moving averages since bouncing off their March 20 lows.
- We recommend a cautious but selective approach to adding risk, with a focus on high relative strength ideas that are part of leading and/or improving industry groups.
- Sector participation was mixed. Energy and Utility led the advance, while Transportation and Capital Equipment led the decline. On our rotation chart, Consumer Staple, Technology, and Retail are showing improvements in their short-term momentum. All other sectors are lagging in their short-term momentum (over four weeks).
- European Focus List Update:
- Actionable names include Deutsche Boerse (Xet) (DB1X.DE; DB1 GR), ASM International (ASIN.NL; ASM NA), Straumann Holding (STMN.CH; STMN SW), Edenred (EDEN.FR; EDEN FP), Evolution (EVOG.SE; EVO SS), Ferrari (Mil) (RACE.IT; RACE IM), Wolters Kluwer (WSG.NL; WKL NA), Compass Group (CPG.GB; CPG LN), ASML Holding (ASML.NL; ASML NA), and Swedish Orphan Biovitrum (SOBI.SE; SOBI SS).
- Addition: ASM International (ASIN.NL)
- Removal: Sika (SIKA.CH)
