Businesses are cash-generative and capable of dividend growth

The UK stock market is having to contend with high oil prices but it continues to make good progress. Fundamentals remain sound, the corporate sector is in good health and UK equities are attractively valued relative to bonds and cash. The financial position of the UK corporate sector remains particularly strong for this point in the economic cycle and, critically, companies are still reporting high levels of dividend growth, while share buybacks continue apace. The combination of solid top line growth and good cost discipline, in the form of restructuring and outsourcing, has enabled he...