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Where's the value in European equities?

Value versus growth has been the key debate in European equities this cycle.

Of course, growth has really been the pre-eminent style in this world of quantitative easing and low interest rates. Logically, however, I would expect that to fade in the second half of 2019.

The reason for that is we are starting at such an extreme level. I can now say that value has never been cheaper relative to growth. This includes during the TMT/dotcom bubble which burst in 2000.

With this in mind I favour sectors such as financials, but also smaller ones such as the oil services sector, where I think there is a potentially really interesting investment opportunity at the moment. It is very unloved and very depressed and we expect to see a recovery. As we expect growth to fade in the second half of 2019, this is an area I am focusing on.