Corporate activity fails to assist paper stocks

European growth is pushing demand and prices upwards in the sector while the weak euro is limiting foreign imports. However, some fund managers say stocks are fully priced and there will be no earnings surprises on the upside. In the 12 months to May this view has been reflected in returns between 22-25% by the top stocks in the sector compared to the Dow Jones Eurostoxx 50, which has grown by 41%. Ken Baksh, associate director for Europe at L&G Asset Management is positive on paper and forestry companies. He says: "If you go back a bit the sector has been fairly dismal, although part o...