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European Equity Markets Continued Positive Trend, Awaiting More Perspective From Draghi & ECB; Market Data and Insight From Russell Indexes and Russell Investments


November 22, 2013 - SEATTLE, WA

As European Central Bank (ECB) President Mario Draghi prepares to deliver the keynote address at the European Banking Congress in Frankfurt on Friday, the European equity markets continued to exhibit strong performance.

European stocks have enjoyed strong performance in 2013. The Russell Developed Europe Index has returned 19.8% year-to-date and is up 4.3% in the fourth quarter (returns as of November 19).

"Core" as well as "peripheral" European countries have seen strong performance. Germany is up 7.0% in the fourth quarter and 22.6% year-to-date, while Italy (+9.4), Ireland (+8.0%) and Norway (+7.5%) have been particularly strong in the fourth quarter (country constituents of the Russell Developed Europe Index as of November 19).

"Although European equity markets have underperformed U.S. equity markets this year, possibly due to concerns regarding disappointing GDP growth, recent ECB easing appears to have had a favourable impact on prices," said Wouter Sturkenboom, investment strategist with Russell Investments Europe. "Investors will be watching Mario Draghi's public comments later this week to try to discern how the European Central Bank will move forward with respect to monetary policy as well as the asset quality review and bank stress test. We believe the latter is particularly important because bank lending continues to be a concern, holding back economic growth at a time Europe needs all the growth it can get."



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4Q-to-Date as 2013 YTD as
Index / Index Country Constituent of Nov 19 of Nov 19
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Russell Developed Europe Index 4.3% 19.8%
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Russell Developed Europe Index - Austria 5.1% 13.1%
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Russell Developed Europe Index - Finland 7.4% 34.2%
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Russell Developed Europe Index - France 3.4% 22.5%
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Russell Developed Europe Index - Germany 7.0% 22.6%
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Russell Developed Europe Index - Ireland 8.0% 38.4%
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Russell Developed Europe Index - Italy 9.4% 21.3%
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Russell Developed Europe Index - Luxembourg 6.2% 6.5%
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Russell Developed Europe Index - Netherlands 4.8% 16.5%
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Russell Developed Europe Index - Norway 7.5% 10.5%
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Russell Developed Europe Index - Portugal 5.7% 19.9%
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Russell Developed Europe Index - Spain 6.1% 23.0%
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Russell Developed Europe Index - Sweden -0.2% 17.5%
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Russell Developed Europe Index - Switzerland 2.5% 21.6%
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Russell Developed Europe Index - United Kingdom 3.6% 16.5%
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Source: Russell Investments. Returns are euro-denominated and are total returns reflecting reinvestment of dividends and distributions.

The Russell Global Index measures the performance of the global equity market based on all investable equity securities, and is constructed to provide a comprehensive and unbiased barometer for the global segment. The index includes more than 10,000 securities in 47 countries, and covers 98% of the investable global market. All securities in the Russell Global Index are classified according to size, region, country and sector; as a result the index can be segmented into more than 300 distinct benchmarks.

Please note: Indexes are unmanaged and cannot be invested in directly. Returns represent past performance, are not a guarantee of future performance, and are not indicative of any specific investment. Russell's publication of the Indexes or Index constituents in no way suggests or implies a representation or opinion by Russell as to the attractiveness of investing in a particular security. Inclusion of a security in an Index is not a promotion, sponsorship or endorsement of a security by Russell and Russell makes no representation, warranty or guarantee with respect to the performance of any security included in a Russell Index.

Past performance does not guarantee future performance. This material is not an offer, solicitation or recommendation to purchase any security. Returns cited are euro-denominated.

Opinions expressed by Mr. Sturkenboom reflect market performance and observations as of November 19, 2013 and are subject to change at any time based on market or other conditions without notice.

Nothing contained in this material is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The general information contained in this publication should not be acted upon without obtaining specific legal, tax and investment advice from a licensed professional. The information, analysis and opinions expressed herein are for general information only and are not intended to provide specific advice or recommendations for any individual entity.

Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide, including Russell Investments, and is a subsidiary of The Northwestern Mutual Life Insurance Company.

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