“We should bear in mind that through its QE programme Europe will inject the equivalent of 10% of its GDP in the system, only the first year,” experts at Bankinter noted. “That money will sooner or later get to the stock markets pushing stock prices upward.”
“Companies will have access to very cheap financing (probably under 1%), and that will make a share repurchase process inevitable. With a financing cost of about 1%, ROE usually higher than 5%-6% (which is not too much) and dividend profits of at least 3%,” they added.
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