Fund managers increase exposure to 'hammered' UK financials sector

'Brexit fog to clear':

Tom Eckett
clock • 5 min read

UK fund managers are positioning their portfolios for a rally in financials later this year amid predictions a Brexit deal will finally be agreed between the UK and the EU, paving the way for higher interest rates.

Although it was expected the Bank of England (BoE) would follow the Federal Reserve's path in hiking rates this year, growing concerns around the Brexit negotiations prompted analysts to rein in rate rise expectations causing a "knock-out" blow to the UK financial services sector in 2018. Last year, the FTSE All-Share Financial index plummeted 13.6%, underperforming both the FTSE All-Share and MSCI World, which lost 9.5% and 3% respectively. Higher interest rates, an environment typically supportive of banks, have been put on hold by the BoE, having only been raised twice since the cu...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Markets

Market Movers: Advisers expecting healthy UK equities growth

Market Movers: Advisers expecting healthy UK equities growth

‘It’s no surprise investors are warming up to UK equities again’

Professional Adviser
clock 13 June 2024 • 1 min read
OBR shows UK growth flatlined in April as general election looms

OBR shows UK growth flatlined in April as general election looms

Challenges PM's claims 'the economy has turned a corner'

Eve Maddock-Jones
clock 12 June 2024 • 1 min read
Back to low inflation: How can we expect the rest of 2024 to play out?

Back to low inflation: How can we expect the rest of 2024 to play out?

‘By August, the conditions will be met to start cutting’

Charlotte Moore
clock 23 May 2024 • 4 min read