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Colin McLean, managing director of SVM, said the share prices of some stocks in sectors such as banking and retail had been supported by high yields and could be set to suffer as companies like Royal Bank of Scotland staged rights issues and cut dividends.

"Recent dividend cuts from banks and other household names will hit investors hard," said Mr McLean. "They follow more than 12 months of poor share price performance from high-yielding areas of the stock market. The pain of a dividend cut on a high-yielding share can be greater than most, if the yield has been propping up the share price."

SVM's £2.1m UK100 Select fund, which picks stocks from the domestic large-cap index, holds high weightings in oil and commodities with an underweight in financials.

Holdings in mining group Xstrata, oil extraction company BG Group and precious metal specialist Randgold helped it produce 7.5 per cent in April, although Mr McLean said suggestions the worst of the credit crunch was over were "wishful thinking".

He concluded: 'The UK economy is in the early stages of a slowdown, which the Bank of England can do little to stop. Some businesses – particularly in the consumer sector – enter this stage in the cycle with weaker balance sheets, possibly exacerbating any trading weakness. Investors should rebase expectations and recognise the merits of slow but steady dividend growth in sectors such as tobacco and utilities."