Good stockpicking likely to drive UK equity returns

ON UK INCOME

AXA Framlington's George Luckraft on his positive outlook for the sector.

The outlook for UK equity income remains positive, with good stockpicking likely to drive outperformance. The relative underperformance of FTSE 100 companies during 2010 was negative on the sector, given the bias towards larger companies as a source of yield. In an environment where yield is harder to find, larger firms offering dependable income returns should find support. Furthermore, BP is expected to start paying dividends again in 2011, while some banks are likely to resume payments during 2011/2, providing opportunities for income investors. Beyond large cap, there remain ma...