Stoxx600 (MEUD) : Is an extended rebound in the pipe?

Lyxor stoxx 600 Net Return (MEUD) - 07/01/19

Short Term strategy: Negative (10%) / Trend +
Long Term strategy: Negative (30%) / Trend =

Characteristics of the ETF

The MEUD ETF (Lyxor) created in 04/2013 replicates the STOXX600 Net Return index which is composed of the 600 largest European stocks representative of the main sectors, while the stocks ​​of the Euro zone represent approximately 52% of the index, there is therefore a significant exposure to other European currencies, in particular the British Pound and the Swiss Franc.

The fees of the ETF MEUD are quite low at 0.07% and the AUM is €1452M. Replication is direct (physical) and there is a dividend capitalization policy.

Alternative ETFs: C6E (Amundi in Euro), ETZ (BNP Paribas Easy in Euro), EXSA (iShares in Euro)


Index & components

The MEUD (Lyxor) tracker replicates the European benchmark, which enjoys a very important depth with 600 holdings ​​and a great diversity by its exposure to the main sectors and countries of the European Union, including outside of the eurozone.

This index is a benchmark for the European markets, and we analyze its stock market behavior with great attention because the evolution of this index partly conditions our sectoral and geographic strategy. The index is fairly balanced in its weighting with 4 major sectors that represent two thirds of the capitalization. In the first position is the cyclical and sustainable consumer goods sector (21,5%), which includes food giants such as Nestlé or AB-Inbev, as well as luxury, cosmetics and ready-to-wear brands like LVMH or Inditex as well as the automotive sector; financial (19.1%) industry (13,4%) and health (14,4%). In this index, energy-related values ​​represent only 7% and raw materials 8.2%.

In addition, it should be noted that there is a certain level of currency risk in this index consisting of 25,3% of British securities and 13.7% of Swiss securities, even if the securities concerned are international and fairly exposed to the dollar.

The STOXX600 is very representative of the European economy because of its sector weighting, which is less favorable to oil than in some national indices (like the CAC40), while the financial sector (banks + insurance) remains a key compartment with 10% of the weighting but without reaching the weight of the Italian or Spanish indices (c.30%). This balanced weighting allows MEUD to have lower volatility than the national indices, as this index is much more diversified and without sector bias. The ETF MEUD has the advantage of replicating a broader index than the Eurostoxx50 and which also incorporates smaller capitalizations, but with a more dynamic path. The European economic cycle is currently weakening, which is validated both by the PMIs datas and also the market consensus for corporates which is adjusting lower at quick pace for 2019 results expectations.

The ECB remains a factor of stabilization and the monetary normalization should be very progressive in the absence of inflation .


Latest developments

The Stoxx600NR finished the year 2018 on a drop of -10.7% after a rise of 10.6% in 2017 justified by the double-digit growth of the companies' results.

The year 2018 ends with a sharp correction, which is explained by an overall economic slowdown linked to the US-China trade war as well as the Fed's monetary policy, which continues to be more concerned about inflation than by the current economic cooling which may end up causing a recession in the US and frightened the markets in December.

The European index is also sensitive to Brexit risks, while total confusion reigns a few weeks before the deadline and results in a total lack of visibility.

Weekly data

The weekly chart shows a trough figure from the last three candlesticks that implies a likely continuation of the rebound in the coming weeks. Some oscillators have begun to turn upward which confirms the inflection, but which has yet to be validated. The objective of this rebound is the EMA100 located about 5% higher at 760 pts. This is a rebound inside a downtrend that could resume its course thereafter.

Daily data

On the daily chart we can see an ongoing rebound whose amplitude and strength seems superior to the other attempts, which resulted in a positive crossing of the MACD confirmed by the RSI. The EMAs100 and 200 are descending and will represent significant resistances for this rebound if it were to expand and could converge towards the resistance of 745 pts for a meeting point with the index.


MEUD is a UCITS ETF, listed in EUR, which seeks to replicate the Europe STOXX600 index (600 european companies)



Inception date 03/04/2013
Issuer Lyxor
Expense ratio 0,07%
Benchmark Stoxx 600
Ticker MEUD
ISIN LU0908500753
EU-SD Status Out of scope
Exchange Euronext Paris
Assets Under Management 1 439 M€
Replication Method Direct (Physical)
Dividend Capitalization
Currency Risk Yes
Number of Holdings 600
Risk 3/5

Country Breakdown

United Kingdom 24%
France 17%
Germany 15%
Switzerland 15%
Netherlands 6%
Spain 5%
Sweden 4%
Others 14%

Sector Breakdown

Financials 20%
Industrials 14%
Consumer staples 13%
Health Care 13%
Consumer discretionary 11%
Materials 8%
Energy 7%
Others 15%

Top Ten Holdings

Nestlé 3%
Novartis 3%
Roche Holding 2%
Total 2%
Royal Dutch Shell 2%
BP 2%
Sanofi 1%
SAP 1%
Astrazeneca 1%