The UK equity market seems to be benefitting from all the chaos that Brexit has caused. While the other markets are being negatively affected by the uncertainty, the equity market seems to be shrugging off all the negative estimates for corporate earnings growth.
Patrik Schowitz, the global multi-asset strategist at JPMorgan Asset Management, said that “It’s the one market in the world where forecasts are going up.” JPMorgan Asset Management seems to view the UK equity markets very positively. The improved forecasts are mostly the result of the falling exchange rate of the British pound. This is because the vast majority of revenues for companies in the FTSE 100 (UK’s index similar to the US' S&P 500) are made outside of the UK. The British pound lost 1.7% of its value against the US dollar since the start of 2019.
You need to be a member in order to leave a comment
Sign up for a new account in our community. It's easy!
Already have an account? Sign in here.