SOURCE: Russell Investments

Russell Investments

October 11, 2013 10:19 ET

Shutdown Shakedown: Eurozone Equities Outperformed U.S. Since U.S. Government Closed Shop, According to Russell Indexes

SEATTLE, WA--(Marketwired - Oct 11, 2013) -  Eurozone stocks have outperformed U.S. stocks since the U.S. government shutdown began October 1, according to Russell Indexes. Also, notably, value stocks have outperformed in non-U.S. markets year-to-date as of October 7, while growth stocks led in the U.S. as reflected by the Russell 3000® Index. 

  • For the month of October as of October 8, the Russell Eurozone Index has returned 0.2% relative to a (-2.0%) loss for the Russell 3000 Index for the same time period. 

  • This builds on a 2013 third quarter return of 11.3% for the Russell Eurozone Index, outpacing the U.S. Russell 3000 Index which had a 2.1% return for the same time period. The two indexes are now equal for year-to-date performance as of October 8.

  • For 2013 year-to-date as of October 8, value stocks (17.6%) have outperformed their growth counterparts (13.5%) within the Russell Eurozone Index. The opposite holds true for U.S. stocks, as reflected by the outperformance for the Russell 3000 Growth Index (15.8%) versus the Russell 3000 Value Index (15.5%) for the same time period.

"Eurozone stocks continued to pull ahead in October relative to U.S. stocks, driven to a large extent by the retreat of Berlusconi in Italy and the current dysfunction of the U.S. government with a looming debt ceiling deadline on the horizon," said Wouter Sturkenboom, investment strategist with Russell Investments Europe. "We continue to see improving economic fundamentals in Europe combined with relatively low market valuations. Given these factors, it is no surprise that value stocks have outperformed in Europe amid an increasingly favorable climate for European equities." 

Index October
Month-to-Date as of Oct 8
3rd Qtr 2013
  2013 YTD as of Oct 8
Russell Eurozone Index 0.2%   11.3%   15.7%
Russell Eurozone Growth Index -1.4%   8.0%   13.5%
Russell Eurozone Value Index 1.3%   13.7%   17.6%
Russell 3000 Index -2.0%   2.1%   15.7%
Russell 3000 Growth Index -2.4%   4.2%   15.8%
Russell 3000 Value Index -1.7%   0.1%   15.5%

Source: Russell Investments. Returns are euro-denominated.

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. 

Past performance does not guarantee future performance. This material is not an offer, solicitation or recommendation to purchase any security. Returns cited are euro-denominated.

Opinions expressed by Mr. Sturkenboom reflect market performance and observations as of October 8, 2013 and are subject to change at any time based on market or other conditions without notice. 

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 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.