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Collins Stewart says stick with riskier stocks
Investors should stick with cyclical stocks and small caps while interest rates remain on hold, Collins Stewart Wealth Management (CSWM) has said.
Robert Jukes, global strategist at CSWM, said the division was bullish on prospects for global economic recovery.
He said interest rates would most likely remain low this year as the worldwide stimulus packages would push up the price of assets, rather than consumer price inflation (CPI).
Mr Jukes said although interest rates had hit record lows, they had fallen by less than they did during the UK's last recession.
However, he said sterling and interest rates had never dipped so far beneath their average levels at the same time. This created "extremely loose" monetary conditions, fuelling riskier assets such as cyclicals and small caps.
