Beyond Bulls & Bears

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Multi-Asset

Why ECB Tapering Expectations May Be Premature

“Financial markets across Europe seem to have taken upbeat comments from European Central Bank President Mario Draghi late last month as evidence that the end may be in sight for accommodative monetary policy in the region. Our view is more nuanced.” Matthias Hoppe, Franklin Templeton Multi-Asset Solutions.

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Equity

Notes From the Trading Desk – Europe

"Central bank commentary has been driving headlines throughout the second quarter, from our perspective, and last week was no exception as several monetary policymakers in different jurisdictions gave a hawkish tilt to speeches, fuelling speculation that the period of ultra-accommodative monetary policy could be approaching an end.” - Franklin Templeton European Trading Desk team.

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Equity

Value Update: Where Is the Next Pocket of Opportunity?

"As the anticipated value rally gains steam, we think non-US stocks should begin to benefit. Like the value universe a year ago, non-US equities today look to us to be undervalued, under-owned, and exposed to positive catalysts, including improving corporate fundamentals, economic tailwinds and political and policy support.” - Templeton Global Equity Group

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Fixed Income

Global Economic Perspective: June

In this month’s Global Economic Perspective, Franklin Templeton Fixed Income Group examines whether inflation may gain momentum in the United Sates, why it’s pleased the European Central Bank has resisted tapering of its quantitative easing program and why investors in all markets need to be cognizant of political risks.

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Perspectives

Uncharted Terrain: Today’s Global Market Drivers

Despite some uncertainties, economic improvements in developed and emerging markets have supported a positive mood across both equity and fixed income this year. However, with some risks on the horizon, many investors are wondering whether the tide may turn. Against this backdrop, Franklin Templeton’s senior investment leaders discuss where they see opportunities and risks ahead.

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Equity

UK Election Result: Grounds for Optimism in the Medium Term?

“The UK election result came as a shock to most observers, but early indications suggest financial markets don’t view it as an end of the world scenario. And there are indications that some positives could emerge over the medium term.” Colin Morton, vice president, portfolio manager, UK Equity Team, June 9, 2017.

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Fixed Income

Theresa May’s Shock Defeat Threatens Further Volatility

“The prospect of a hung parliament, resulting either in a minority government or a coalition, paints a picture of an administration not in complete control during a period in which the United Kingdom needs its most focused administration for 70 years. ” David Zahn, Franklin Templeton Fixed Income Group, June 9, 2017.

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Equity

The Politics of Health Care

“There have been huge breakthroughs in gene therapy as well as in the area of cancer treatment. Major waves of innovation are a reflection of the exponential leaps in basic research and our understanding of human biology, which are now bearing fruit.” - Evan McCulloch, Franklin Equity Group

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Fixed Income

Is It Time to Consider European Sovereign Debt?

"The divergence between bond yields of some eurozone countries should bring potential opportunities for investors willing to be flexible in the way they move in and out of areas where they don’t see value.” David Zahn, head of European Fixed Income, Franklin Templeton Fixed Income Group.

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Equity

Prospect of Snap Election in Italy Spooks Equity Markets

"Assuming Italy will vote in 2017 and gain a stable coalition, all three major euroland countries will have newly elected governments. Hopefully, they can all work together for the next three to four years on EU reform following the United Kingdom’s exit. We think this could give financial markets long hoped-for political stability, the chance to mend the European project and reinvigorate growth.” Robert Mazzuoli, portfolio manager, Franklin Local Asset Management, European Equities.

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Fixed Income

If It’s Groundhog Day, Why Aren’t Investors Learning the Lessons?

The repeated financial market patterns of recent years have reminded some market professionals of the 1993 Bill Murray movie "Groundhog Day." But according to Christopher Molumphy, CIO of Franklin Templeton Fixed Income Group, investors may be missing the most important lesson of that movie: take heed of your experiences.

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Equity

The “Known Unknowns” Surrounding the Public Offering of Saudi’s Crown Jewel

Bassel Khatoun, our CIO of MENA Equities, discusses what he sees as a set of “known unknowns” that could influence the valuation of Saudi Aramco. He suggests an accurate valuation is premature, pending further clarification.