Managers rotate back to UK domestics ahead of General Election 'clarity'

Driven by hopes of Brexit resolution

Fund managers have been increasing their exposure to domestic UK stocks ahead of the 12 December General Election in the expectation that a Conservative Party majority will deliver a resolution to Brexit and avert the economic fallout of a Labour victory, thereby creating a bullish environment for domestically exposed stocks.

The most recent data (13 November) from polling company ComRes has the Tories on track to receive 40% of the vote, leaving Labour on 30%, though that would not deliver enough seats in the House of Commons to command a majority. Domestic UK companies saw a brief boost last week after Nigel Farage confirmed his Brexit Party would not contest constituencies currently held by the Conservatives but would instead aim to make gains in Labour-held seats. Sterling rose by 0.63% against the US dollar over the course of Monday (11 November) on the news, with Nigel Green, founder and CEO of deVer...