Growth bias

After such a long period of growth in the UK, companies exposed to the economic cycle should be enjoying their best environment for years. However, recent announcements from Invensys, Rolls Royce, Kingfisher and Corus reveal a very different picture. Volume growth is often low or non-existent, and margins are being squeezed. Part of the reason lies in the changing makeup of growth, not just in the UK but across most developed countries. Globalisation of markets has created intensely competitive conditions for traded goods. Pricing power has been removed, leaving profit margins exposed to r...