SOURCE: Russell Investments

Russell Investments

October 24, 2014 10:59 ET

In Volatile Month, UK Equities Outperformed European Equity Markets in October-to-Date: Russell Indexes

SEATTLE, WA--(Marketwired - Oct 24, 2014) - Following today's announcement that UK GDP was 0.7% for the third quarter, Russell strategists remain positive on the UK economy but believe UK growth is at peak levels, which may cause concerns for investors.

In a volatile month for global equity indexes, Russell Developed Europe Index returns show that the UK outperformed European equity markets during the first three weeks of October. The Russell Developed Europe Index returned (-5.5%) month-to-date as of October 21. Individual country constituents the United Kingdom (-3.8%), Finland (-4.0%) and Austria (-4.4%) were the strongest performers for this time period. Ireland (-12.1%), Norway (-9.6%) and Portugal (-9.3%) were the laggards month-to-date as of October 21 within the Index.

Russell Investments Europe Investment Strategist Wouter Sturkenboom:
"Over the last two quarters, we have seen growing confirmation of a more sustainable economic recovery in the UK driven by business investment and employment growth and our leading indicators give us affirmation of more to come. And the fact that the Scottish referendum is out of the way does not hurt either. However, we do believe that in this environment BOE Governor Carney is under increasing pressure to launch the first rate hike. For this reason, he will begin to slowly but clearly set the scene for this occurrence, which may negatively impact UK market performance."

"Looking to the fourth quarter, we continue to see value in UK equities, but are moving to more of a neutral stance on valuation and sector composition concerns."

For more information on the Russell Indexes, go to the Russell Indexes website.

Russell Developed Europe Index Returns

Russell Index  / Index Country Constituent October MTD a/o
Oct 21
2014 YTD a/o
Oct 21
Russell Developed Europe Index -5.5% 1.5%
Russell Developed Europe Index - United Kingdom -3.8% 0.9%
Russell Developed Europe Index - Finland -4.0% 5.1%
Russell Developed Europe Index - Austria -4.4% -12.7%
Russell Developed Europe Index - Sweden -4.8% 1.2%
Russell Developed Europe Index - Switzerland -4.9% 6.8%
Russell Developed Europe Index - Germany -5.8% -6.7%
Russell Developed Europe Index - Spain -6.1% 6.9%
Russell Developed Europe Index - Luxembourg -6.4% -6.8%
Russell Developed Europe Index - Netherlands -6.5% 3.5%
Russell Developed Europe Index - France -7.0% -1.4%
Russell Developed Europe Index - Italy -8.3% 3.4%
Russell Developed Europe Index - Portugal -9.3% -13.0%
Russell Developed Europe Index - Norway -9.6% 4.1%
Russell Developed Europe Index - Ireland -12.1% 10.4%

Source: Russell Investments. Returns are total returns (reflect reinvestment of dividends and distributions) and are denominated in euros.

The Russell Global Index measures the performance of the global equity market based on all investable equity securities, and is constructed to provide a comprehensive and unbiased barometer for the global segment. The Index includes more than 10,000 securities in 47 countries, and covers 98% of the investable global market. All securities in the Russell Global Index are classified according to size, region, country and sector; as a result the index can be segmented into more than 300 distinct benchmarks.

Please note: Indexes are unmanaged and cannot be invested in directly. Returns represent past performance, are not a guarantee of future performance, and are not indicative of any specific investment. Russell's publication of the Indexes or Index constituents in no way suggests or implies a representation or opinion by Russell as to the attractiveness of investing in a particular security. Inclusion of a security in an Index is not a promotion, sponsorship or endorsement of a security by Russell and Russell makes no representation, warranty or guarantee with respect to the performance of any security included in a Russell Index. 

Global equity involves risk associated with investments primarily in equity securities of companies located around the world, including the United States. International securities can involve risks relating to political and economic instability or regulatory conditions. Investments in emerging or developing markets involve exposure to economic structures that are generally less diverse and mature, and to political systems which can be expected to have less stability than those of more developed countries.

Opinions expressed by Mr. Sturkenboom reflect market performance as of October 21, 2014 and are subject to change at any time based on market or other conditions without notice. Past performance does not guarantee future performance. 

Nothing contained in this material is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The general information contained in this publication should not be acted upon without obtaining specific legal, tax and investment advice from a licensed professional. The information, analysis and opinions expressed herein are for general information only and are not intended to provide specific advice or recommendations for any individual entity.

Russell Developed Europe Index country constituents Belgium and Denmark have one constituent with more than a 30% weighting, so did not meet public reporting requirements.

Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide, including Russell Investments, and is a subsidiary of The Northwestern Mutual Life Insurance Company.
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