Suddenly, with two giant, albeit rejected takeover bids, Europe doesn't seem all that bad as a place to invest. Suddenly, the euro seems a little more stable. Suddenly the politics of Europe, after the incredibly destabilizing FBI revelations and the internecine squabble among Republicans, seem downright placid. And with the downfall of the so-called uber-nationalist party in the Netherlands, perhaps politically, suddenly Europe feels like the good old days when you didn't have to think about who was running the government.
OK, maybe I am biased after spending a few days talking to business leaders and fund managers in London. Perhaps I am dazzled that a staid company like PPG (PPG) would pursue a $24 billion hostile bid for Akzo Nobel (AKZOY) or that Kraft-Heinz (KHC) would be willing to shell out $143 billion for Unilever (UL) , but you have to believe these aren't idle chunks of money thrown around by uninformed individuals.
And you certainly have to believe that politically, even one week from the release of the official Brexit document that Europe's got some stability to it that we, ah, lack for the moment?
Now, I am not calling for the end of the Trump trade. That will go on even if health care isn't repealed and replaced in the next 10 days. Only Comey calling for an indictment really stops the longer-term thesis that has carried this market far.
But let's take the case of Diageo (DEO) . Here's a company that sells liquor all over the world that is then translated into weak pounds. How can that not be more desirable to Kraft-Heinz than Unilever at this point? Why do we insist that Kraft-Heinz has to stick with food? Check out Diageo's chart; Bruce Kamich, our technical analyst, says it could be time to take a big drink.
Or how about Santander (SAN) ? With the hub of London about to be tarnished to some degree -- even as I heard nary a public peep from any banker about how London could be impugned by Brexit -- why shouldn't we be thinking about Spain doing better as a financial hub? Santander has done a lot to be recapitalized in the last few years.
We could go for Deutsche Bank (DB) , too, while the rights trading plays out.
And if you felt that the world was going to be a stronger place, how about a stock like Rio Tinto (RIO) ? You think there will be oil and gas mergers -- assess BP (BP) , which in Kamich's opinion has taken the long way back.
All I am saying -- and Bruce Kamich yesterday did a series of terrific charts about European companies -- is that the money has got to come somewhere. And with Brexit now discounted and with the Dutch elections perhaps emerging as the high mark of what could be called violent nationalism, investing in Europe, buying the stocks of U.K. companies that do small business in the UK -- which is now subject I think to inflationary pressures at home -- may not be such a bad idea.
