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Market Overreacted to Europe in 2011: Investor Dreman

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The U.S. stock market overreacted to Europe's financial turmoil, contrarian investor David Dreman told CNBC Tuesday.

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"I am optimistic" about 2012, said the chairman of Dreman Value Management and author of several books including  "Contrarian Investment Strategies — The Next Generation."

"I think we’re probably going to see less emphasis on the whole European situation. They are taking a backseat here," he said. "I think there was an overreaction last year."

Dreman said that with or without a euro zone, "Germany will continue to do well. I think France will do reasonably well. We haven’t seen much slower growth up to now. It is certainly not hurting the United States up to this point."

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Investing Optimism in 2012

He sees unemployment continuing to be a major U.S. problem for the next two to three years. At the same time, Dreman expects stocks at "valuations that are lower than at any point since the mid-1990s."

He likes some "blue-chip" European stocks, including Nestle and Unilever, as well as oil and gas stocks such as Apache and Anadarko .