Nigel Thomas has issued a bullish call on domestic UK companies as the economy continues to improve.
The stocks in Mr Thomas’s £4.6bn AXA Framlington UK Select Opportunities fund generate 30.3 per cent of their revenue from the UK, compared to 26.3 per cent for the FTSE All-Share index, and Mr Thomas highlighted the “improving position” of the UK economy to justify the weighting.
Mr Thomas said: “UK permanent salary inflation is the highest since February 2008 and temp wage inflation is not far off a five-and-a-half year high. Vacancies continue to rise at pace and candidates’ availability has fallen further.
“This augurs well for many of our UK-centric companies.”
He said the low global growth environment and low interest rates had also increased companies’ focus on total returns for shareholders, benefiting investors through such things as dividends and share buybacks.
The fund is currently in the second quartile of the IMA UK All Companies sector for performance in both one and three years and Chris St John was recently added as a deputy manager on the fund under Mr Thomas.