Brexit

If the UK equity market was out of favour at the beginning of 2020, it’s even more so now. Until the arrival of three vaccines prompted a wave of market exuberance towards the end of the year, UK equities had fallen approximately 20%. The only two worse-performing equity markets were Russia and Brazil...

The outlook for the UK stock market remains incredibly foggy in the run-up to this year’s general election. Most global investors continue to regard the UK as an uninvestible market, as they have since the EU referendum in 2016.

The UK takes a big step towards Brexit, with today’s key announcement. Parliamentary ratification is the next major hurdle to clear. With the DUP reportedly uncomfortable with the deal, the parliamentary arithmetic for Saturday’s vote is very hard to call.

For someone living, moving to or doing business with the United Kingdom in the last year, the “Brexit Question” has been an important consideration. During the beginning of 2019 there have been several dates, votes and occasions when we expected to get a detailed picture of what Brexit will mean. Yet we were then left staring at each other, still wondering what the outcome might be.

Political risk has been a feature in European markets for years. Lately, from Italy’s fiscal squabbles to turmoil in the streets of France, it feels like the volume of political noise has risen. However, political risk is not a reason to avoid European equities.