HALISTER1: Stay Bullish on European Stocks as Bond Yields Set to Rise: Citi

Stay Bullish on European Stocks as Bond Yields Set to Rise: Citi

(Bloomberg) -- Economic growth, better earnings and lower risk across the world will support stocks even though valuations aren’t cheap, Citigroup strategists led by Jonathan Stubbs write in note.
  • Notes Citi colleagues turned bearish on U.S. rates and on European credit earlier
  • Citi recommends positioning for high bond yields; buy banks and autos, sell real estate and food and beverage stocks
    • BNP, UBS, Aviva, Renault, ArcelorMittal among dividend-paying stocks that will benefit
    • Diageo, Givaudan, Relx, SSE among stocks that should underperform
  • Note: Strong Euro, Rising Pound Take Bite Out of Stoxx Index, Earnings
  • Sept. 7: It’s a Good Time to Rebuild Positions in Riskier Assets: Pictet
To contact the reporter on this story: Sofia Horta e Costa in London at shortaecosta@bloomberg.net To contact the editors responsible for this story: Celeste Perri at cperri@bloomberg.net Kasper Viita

Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
AV/ LN (Aviva PLC)
BNP FP (BNP Paribas SA)
RNO FP (Renault SA)
UBSG VX (UBS Group AG)

People
Jonathan Stubbs (Citigroup Inc)

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