‘UK equities should improve despite volatile H1’

‘UK equities should improve despite volatile H1’

Advisers should prepare clients for a “tricky and volatile” first half of 2015 before the UK equity market improves, a fund manager has suggested.

Simon Murphy, UK equities fund manager for Old Mutual Global Investors, predicted that UK equity markets would go higher overall by the end of 2015.

“I do not think there is something very, very nasty around the corner”, he said. “I think 2015 is the middle rather than the end of the economic cycle.”

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But he warned that investors should brace for volatility in the first six months of the year, saying that uncertainty would stem from the falling oil price, the anticipation of interest rate rises in the US and UK as well as impending elections in both Greece and Britain.

Adviser view

Tim Stubbs, investment manager for Essex-based Fiducia Wealth Management, said: “One could argue that medium-term prospects have actually improved.

“A delay in the likely timing of interest rates hikes, a strengthening US economy and lower oil prices all serve to provide a significant tailwind to help the UK economy consolidate its medium-term recovery.”