Goldman Sachs | Guide to European Indicies

Hopefully, this is a useful resource for folks new to financial markets, and old hands might even pick up something new.

DAX:

It is a blue-chip index consisting of the 30 major companies trading on the Frankfurt Stock Exchange. The weight of each constituent cannot exceed 10%

The DAX index has low exposure to Germany (20%)

When China sneezes, the DAX catches cold.

MDAX:

MDAX offers access to the German midcap segment

Index has a revenue exposure of 51% to Europe, 19% to North America, 17% to Asia-Pacific and 13% to other Emerging Markets

Argue that it provides a poor reflection of domestic German growth, rates or policies.

CAC 40:

CAC 40 is a benchmark French stock market index

Has low exposure to France (17%)

French market is characterised by its luxury exposure, being home to LVMH, Kering, Hermes

FTSE MIB:

MIB is a benchmark Italian stock market index

The Italian index is more exposed to its domestic market (44%) than its European peers

MIB trades at a discount to the European market (P/E basis)

IBEX:

IBEX is a benchmark Spanish stock market index

IBEX is concentrated in just a few companies: five stocks make up over 50% of its market cap (Iberdrola, Santander, Inditex, BBVA and Amadeus IT)

A fifth of Spain’s sales exposure is to Latin America

FTSE 350:

FTSE 350 is a benchmark UK stock market index

Combination of the FTSE 100 and the FTSE 250.

Has revenue exposure of 26% to the UK, 16% to the rest of Europe, 26% to North America, 21% to Asia-Pacific and 11% to other Emerging Markets

FTSE 100:

The FTSE 100 derives more than 75% of its revenues from outside the UK

Sterling, a cushion for the FTSE 100

FTSE 250:

FTSE 250 is a hybrid index with roughly 50/50 domestic and international sales exposure

The correlation with sterling is more positive; a lower GBP is a drag on the index to the extent it is a signal of economic weakness or political risks

SMI:

Swiss Market Index (SMI) is Switzerland's blue-chip stock market index

The Swiss index has limited exposure to Switzerland (7%) and is the most international index in Europe

Europe's safe haven.

MSCI Nordic Countries:

MSCI Nordic Countries Index captures large and mid cap companies across Denmark, Finland, Norway and Sweden

Nordic index has limited exposure to the region (27%)

Nordic countries relatively stable