QE continues: Are European equities about to turn a corner?

Europe has been shunned by global investors in the past few years for a number of reasons: profitability of European companies has lagged that of global counterparts; poor public finances have threatened the common currency and populist pressures have exacerbated overall business conditions.

As a result of an ailing economy, with the additional pressures of a Chinese slowdown mounting especially for exporters of capital goods, the European Central Bank (ECB) has re-embarked on quantitative easing (QE), printing $20bn per month. Furthermore, new president Christine Lagarde has been considering ending the negative rates regime, which has been hurting northern European lenders especially, without much success in increasing credit demand.  Given the importance of QE for risk assets, the question on the minds of many investors is: are European companies about to turn the corne...