Standard theory will have us believe that rational investors will sense an opportunity and buy the stock at the lower price shorting a similar stock to hedge the position. Thus, buying of the stock will take the price back to its fundamental value.
European politics remains mired in short-termism; individual countries tend to favour internal contingent interests over more far-reaching common initiatives. The outlook for the euro area remains that of stable but moderate growth, with inflation recovering gradually but still excessively low, and elements of persistent frailty in the financial system.