Investing.com – The relationship between volatility in an index that tracks a pan-European index and the corresponding trailing average is flirting with heights last seen during Europe’s sovereign debt crisis, according to analysts at Goldman Sachs.
In a note to clients on Monday, analysts also noted that implied volatility in French equities is approaching some of its highest levels ever compared to U.S. equities.
As a result, they said, “there may be selective opportunities to go long the US.” [versus] European capital [volatility]”
Analysts added that European shares appeared to be “pushing away” from their US peers.
European assets sold off last week after French President Emmanuel Macron decided to announce early elections in the country. The move itself was prompted by a major victory for far-right parties in recent European elections.
However, stocks on Wall Street hit new record highs as signs of easing U.S. inflation helped offset some investor disappointment over the Federal Reserve’s hawkish interest rate outlook.