LONDON, February 2 (FinanceEnquiry.com) - Analyst Gareth Evans at Deutsche Bank provides equity market commentary on Europe.

In a research note published yesterday, Evans mentions that the Stoxx 600 index produced a total return of 4.2% in January, the best January return since 1998. In addition, the banks are benefitting from lower earnings momentum, firmer global economy and the 3-year LTRO. The analyst is concerned about the declining credit growth in Europe that may speed up the weaker-than-expected domestic demand.
 
In January, 14 of the 16 major European markets posted positive returns with Greece leading the group as the best performing country. Greece reported a total return of 30.6% after declining for successive 11 months. The analyst cites Austria (9.8%) and Germany (9.5%) as the best performing countries, while Portugal (-3.1%) and Spain (-0.1%) were the only countries with negative returns. Coming to sectors, global cyclicals, such as Autos (20.9%) and Basic Resources (14.1%), were among the best performing sectors last month. In January, banks gained 9.8% after losing 30.4% in 2011. On the contrary, Retail (-3.8%), Telecoms (-2.6%) and Healthcare (-1.4%) were the sectors with poor performance.