Inflation strikes again – but these investors are looking past it

The specter of inflation is driving some investors out of pricier parts of the stock market, yet many fund managers remain confident that this is merely a bump in the road and equities can overcome the turbulence.

Tuesday's drop is now the third time since mid-April that the Stoxx Europe 600 Index has fallen more than 1.4 percent in a day, as market players fret over price increases and the prospect of higher interest rates that could dent the appeal of technology and growth stocks. In each of the two previous dips, investors quickly stepped in to buy, betting the economic boom would continue fueling the bull run in equities.

"The end of the bull market will come with the next recession," said Martin Moeller, co-head of Swiss and global equities at Union Bancaire Privee in Geneva.

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