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This Is Why Populism Is a Risk for Global Equity Markets

Populism is back in focus.
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Populism is back in focus after Germany's far right Alternative for Germany performed well in elections on Sunday, even though Chancellor Angela Merkel was re-elected for another term.

The news sent European stocks and the euro lower on Monday. Andres Garcia, CEO of Zoe Financial said populism is generally bad for global markets because it can distract politicians from putting forth long-term policies focused on economic growth.

That said, Garcia still favors overseas stocks, especially emerging markets, over U.S. stocks. Valuations for Europe and emerging market equities are lower than U.S. stocks as these economies are not as far along in their economic recovery.

The broad S&P 500 is up 11.8% since the start of the year.

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