Investors are underestimating the strength of the German and French economies, which will return to strong growth in the second and third quarters on the back of export and investment strength, Bob Parker, an analyst with Credit Suisse, told CNBC Wednesday.
In the case of France, Parker is predicting consumer demand will also pick up over the coming months.
U.S. growth will hit 4 percent in the second and third quarters, Parker also told Squawk Box Europe.
He believes we will see the Federal Reserve raise the discount rate soon, with no change in tone on the base rate from the U.S. central bank until September at the earliest.
As we head into the first quarter earnings season, Parker believes many are too bearish on the prospects of corporate profits and that equity markets could overshoot on the upside over the next 6 months.
While Parker cannot pick stocks for compliance reasons, he suggests investors take a look at companies and sectors with low leverage that do not suffer from overcapacity and pay high dividends.
Which sectors should we be looking at? Food and agriculture, household products, energy, health care and IT will offer the best bet, he said.
Parker is also getting back into emerging market equities.