Best Performing Europe Funds

Despite the headwinds currently faced by the European economy, there are also some positive factors to consider in the outlook for the markets this year

Samuel Meakin 21 April, 2015 | 12:24PM

Despite a modestly positive outcome overall, European equity markets in 2014 certainly didn’t enjoy a record year in terms of returns. The economy, and corporate earnings, disappointed prior expectations, with the slowdown in global growth a particular headwind given the few internal drivers of growth within Europe. The ongoing conflict in Ukraine has continued to give cause for concern alongside the recent Greek bail-out impasse, and these issues have all highlighted the fragile nature of Europe’s recovery, with many headwinds remaining as we move further into 2015.

The utilities sector was the best performing area of the market over 2014 as a whole. Much of the sector’s gains came early in the year as the hunt for yield persisted and low interest rates continued to force investors into equities. The story was comparable for consumer staples, which also outperformed the wider Europe ex-UK market.

The telecoms sector provided a similar level of returns to utilities in 2014, although much of this came later in the year. In recent conversations with a number of European-equity fund managers, they have noted that companies in the sector are set to benefit from a better operating environment, with the potential to improve their top lines through their 4G offerings at the same time as their capital expenditure has stabilised.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Janus Henderson Contnn Eurp R€ Acc10.87 EUR1.61
JPM Euroland Dynamic A perf (acc) EUR208.59 EUR-0.31
T. Rowe Price Continental Eurp Eq Q GBP18.10 GBP-0.06

About Author

Samuel Meakin  is a fund analyst for Morningstar

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