Goldman Sachs upgrades European equity index target prices & rating to neutral

Analysts at Goldman Sachs made upward revision to their forecasts for the European equity index target prices, while upgrading the rating to neutral.

Key Quotes:

“We upgrade our SXXP target prices as macro data surprises to the upside, reflationary hopes firm and we think the equity risk premium (ERP) could recede further”

“We now expect the European markets to rise to 375 over 3m (+2.6% form here) and rise slightly higher to 380 over 12m, implying a 4% price return and 8% dividends”

“We raise our targets for the SXSE and the FTSE 100 to 3450 and 7500 over a 12m horizon, implying 7.7% and 8.5% total returns, respectively. Strong global growth and a weaker currency should continue to support the FTSE 100.”

“Our Asset allocation team raises Europe to neutral from Underweight on a 3m horizon”