Societe Generale strategists are sticking with the bulk of 20 stocks picked a year ago and expected to outperform in the event of a euro break-up. Since then, the basket has outperformed the STOXX Europe 600 by 11 percent.
“Our selection was based on the stock’s relative performance positively correlating to a widening sovereign spread, strong balance sheet, and emerging market exposure,” Societe Generale Head of Equity Strategy Claudia Panseri writes in a note.
The stocks it still backs are Akzo Nobel, Sanofi, L’Oreal, Beiersdorf, Henkel, Adidas, BMW, Publicis, Unilever, Roche, Syngenta , SGS, Nestle, Teliasonera, Royal Dutch Shell, Reckitt Benckiser and Tesco.
“We expect further outperformance of our basket in the period to come. Since May 2011, we have not changed the components of the basket, however we would now suggest avoiding capital goods and tech, namely Volvo, SKF and Ericsson, as fears of a bumpy landing scenario in China are on the rise,” she says.
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