- Car Insurance Scofflaws Raise Health Reform Doubt
- Rush Starts as Holiday Shopping Season Revs Up
- US Markets Bracing for Selloff on Dubai Debt Worries
- US Dollar Falls to 14-Year Low Against the Yen
- ING Prices Share Issue at Hefty Discount
- UK's Darling to Downgrade 2009 Growth Forecast
- Tommy Hilfiger's Estate in Conn. Sells for $20 Million
- Cheap Robotic Hamsters Are Holiday's Unlikely Craze
- Fannie Mae to Tighten Lending Standards: Report
- 4 Thanksgiving Week Buys For Your Portfolio: Market Pros
- There's a 'Great Chance' For a Double-Dip Recession: Strategist
- Revenge of the Gangsta Nerds
- Will TCU See The "Flutie Effect?"
- Retail Earnings and Sales to Improve in Q4: Analyst
- Consumers Catching the Holiday Spirit
- It's Beginning To Look A Lot More Riskless
- Crescenzi: Claims Level Suggests End to Job Losses
- Hedge Funds Take Early Lead in Warren Buffett's 'Big Bet'
MOST SHARED
- No Thanksgiving Rest for Retailers in Sales Race
- US Markets Bracing for Selloff On Worries About Dubai's Debt
- UK's Darling to Downgrade 2009 Growth Forecast
- Attraction of Switzerland to Businesses
- More Asia Executives Resigned to Economy Flights: Survey
- ING Prices Share Issue at Hefty Discount
- Oil Falls Below $74 on Dubai Default Worries
- Dubai Debt Delays Revive Fear of Financial Crisis
Text Size 
A series of factors have emerged which have persuaded Michael Browne, portfolio manager at Sofaer Global Research, to become a bull after two years of bearishness, as the recent selloff is a "nice opportunity" to be investing in value stocks.
An incoming upturn in the markets will be based on "not any one thing; it's a number of things," according to Browne.
For instance, used car prices in the US, UK and Germany are all rising as one of the factors influencing his change of investment approach.
"It is counter-intuitive but very important because it starts to suggest there's something happening."
GfK consumer confidence surveys around Europe, with the exception of France, hit their lows around 3 to 6 months ago, while consumer confidence in the UK appeared to have hit a bottom 7 to 8 months ago, Browne said.
"I'm looking at the consumer in Europe, the UK and Spain and Ireland who have between 50 and 80 percent cut in their mortgages. And that's very significant when 30 to 40 percent of your average income is being spent on mortgages," Browne said.
Browne also sees a bottoming out of the Ifo business climate index over the last 3 months, as well as an improvement of the University of Michigan consumer sentiment survey in March.
"I've got indications that the consumer is still alive, and in many respects actually is probably performing rather better, is doing different things to that we've seen in previous recessions. This is starting to add up," he said.
Stocks have risen 20 percent over the last three weeks in what analysts still believe to be a bear-market rally.
"Europe always hits a low 3 to 6 months after the United States," according to Browne.
He therefore does not see a reason to be short, as European stocks will hit a low soon and the reason investors have been shorting stocks — on concerns of companies' balance sheets — has been removed.
Browne said he has bought 6 to 8 "deep value" stocks over the past couple of months, which include PPR and Man Group, who will be paying their dividends. He also sees pharmaceuticals and branded food companies as on their way down.
For the Investor:
Print
Email
- What you need to know.
- Social enterprises are becoming a new asset class for the ethically-minded.
- Ever wished your cab driver would stop nattering and just get to where you're going? Well that moment is near(er).
- Bill Griffeth is taking a leave of absence from CNBC and Power Lunch for a year. Here's a message from Bill.
- More shoppers than ever plan to comparison-shop this season. Who will benefit?
- It may be the most unusual guide to business you'll read.
Data is a real-time snapshot *Data is delayed at least 15 minutes