Earnings to beat expectations

HSBC UK Focus manager selling out of stocks that are susceptible to government cuts

HSBC head of UK equities Alec Letchfield believes corporate earnings could beat expectations this year but fears changes to monetary policy could lead to volatility. Letchfield, who manages the £4m UK Focus fund, has sold out of stocks such as BAE Systems and Carillion as he feels both will feel the effect of major cuts to government spending regardless who wins this year’s general election. Instead he has increased holdings in Compass Group, Carnival and Britvic to individual positions of over 3% each. Letchfield says these stocks stand to do well in a recovery as businesses outso...