Rob Burdett, co-head, BMO multi-manager team
So, this week the IMF upgraded the growth forecast for the UK. In fact they have done it by more than for any other economy in the world. But, despite that, we are actually underweight the UK. Although things like the currency have reacted to the possible impact of Brexit we don’t believe the impact on corporate earnings is known; the terms of trade are just not available and won’t be for some time. In addition, the market has run ahead a long way. So, we are happy to be underweight the UK at the moment.
Ryan Hughes, head of fund selection, AJ Bell
I am slightly bullish on the prospects for the UK but I have to caveat that with the fact that Brexit still creates significant uncertainty, nothing has really changed yet. And, as we move through the triggering of Article 50, we really need to try and understand what that means for UK equities. I think the large cap equities have the potential to be fine with the tail wind of the currency. But, as we look towards the mid cap and the small cap, there is certainly the potential that it is a more challenged outlook as we go through 2017 and into 2018. But, actually, we have got quite a decent economic picture today, low unemployment, decent PMI numbers., So it looks like the foundations are there, but I think we still have a few bumps in the road that we will need to get through to see where we end up at the end of the year.
Andrew Merricks, head of investments, Skerritts
You can’t really be that bullish, it is so uncertain, whether it is a hard Brexit, soft Brexit, no Brexit, Goldilocks Brexit, who knows. You can’t be bullish on the outlook for the UK, it is just so uncertain, it could go either way. So, unless you have to invest in the UK, then I don’t think you should be at the moment because you can’t with any certainty.
Amedeo, head of research Old Mutual Global Investors
Currently, we continue to be positioned in a risk on environment. We moved toward this positioning in the second half of last year and conditions in the market continue to remain in line with that. And that is both in terms of the UK and also the wider European equity markets.
