A decision tree for navigating Brexit uncertainty
Unchecked decisions at high levels were at the heart of the global financial crisis. Today, a decade later, there is a far sharper focus on how organisations are governed, with institutional investors expected to take a much more robust stance in calling to account the companies whose shares they own. As a leading asset manager, Rathbones takes its stewardship responsibilities seriously.
UK stocks have underperformed other major developed markets so far in 2018, extending a pattern that has been in place since the June 2016 vote to leave the EU. A longer-term analysis also suggests Brexit isn’t the only thing weighing on UK companies, so why should investors be interested in UK equities now? We think investors are pricing in a fairly negative Brexit scenario, and see UK shares as offering fundamental value and opportunity in differing economic outlooks.
The spectre of higher inflation and rising interest rates sent a shudder through global markets in February. It could still cause some sleepless nights over the rest of the year, but we don’t see anything too alarming on the horizon.
In a post-Brexit world, Britain may have to become less reliant on its financial services sector and the South East.