EU Periphery Stocks Surge: Financial Weighting Or Valuation?

Now that the EU periphery has pulled through the sovereign debt crisis and is either out of recession or set to start growing towards the end of this year, investors are moving back in to benefit from the full range of the expected recovery. Greece, Italy, and Portugal stock markets are each up at least 14% so far this year, Bloomberg reports, Ireland isn’t fare behind with 10% gains, and even Spain has grown 4.3%, outperforming the S&P 500’s 1.3% growth year-to-date.

There’s no doubt that the growth is speculative, but there doesn’t seem...