JP Morgan equity strategists back German market over France

[February 20, 2017]  PARIS (Reuters) - JP Morgan Cazenove equity strategists on Monday backed favoring the German stock market over the French one, partly due to risks around the French presidential election and on prospects that Germany would benefit more from global economic reflation.

"Germany is a good hedge on French political risk - keep pair trade DAX vs CAC-40," they wrote in a research note.

"We continue to see attractive risk-reward for Germany," they added, citing further positive impacts on the DAX from a weakening euro and relative valuations.

"The DAX is trading near 25-year P/E relative lows and is exceptionally attractive versus German bonds, whose TR (total return) is flat-lining over the past 12 months," they wrote.

(Reporting by Sudip Kar-Gupta)

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