Peripheral Eurozone equity and bond markets can continue to rely on the support of the central bank and consequently on persisting interest from investors. 

## Peripheral Eurozone bond yields substantially lower

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## ECB and economic data boost financial markets

Investor risk appetite has received several major boosts over the past few weeks. The announcement of fresh monetary steps by the European Central Bank was of course the main one. 

Although expectations had been very high since May, the package of measures announced on 6 June proved to be even more comprehensive than anticipated. It demonstrated once more that ECB President Draghi is highly capable of managing market expectations. The positive confidence effect which resulted from the ECB’s actions was perhaps the most significant factor in the market’s response; more liquidity and a further decrease in the risk of a Eurozone break-up boosted equity and bond markets in the peripheral Eurozone countries in particular. These peripheral countries can continue to rely on the support of the central bank and consequently on persisting interest from investors. 

Moreover, stronger evidence emerged that the slowdown in economic growth in the first quarter was probably a temporary dip. Global economic activity (measured by the global PMI) was up sharply in May, while economic figures in the US, Japan, China and the Eurozone were also positive.

Added to the fact that investor positions in specific asset classes are significantly less concentrated than they were at the start of this year and that the mood among investors is less euphoric, and we see sufficient arguments to retain our diversified risk-on positioning. This translates into significant overweights in equities and real estate and slight overweights in spread products and commodities.