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Good Times Can't Last Long With Defensives On Top
by Tyler Durden
Tuesday, Apr 18, 2023 - 09:11 AM

Authored by Michael Msika via Bloomberg,

European stocks are on the front foot, testing their highest levels in more than a year as some shares that benefit from positive economic news stage a comeback. At the same time, nagging worries about a potential recession could keep defensive parts of the market in favor, capping broader gains.

The Stoxx 600 is up 2% in April, keeping in with the month’s track record as the best of the year. Banks and energy names are buoyant, but a retreat by investors into reliable sectors like health care and telecoms shows no sign of abating. The issue for the benchmark index is that in the long run, cyclicals are way more important to its performance.

About two thirds of its members lean toward cyclical industries, and while defensives can pull the index higher, that’s much rarer.

https://www.zerohedge.com/markets/good-times-cant-last-long-defensives-top