Artemis' Steer returns to ‘overlooked' UK domestics

UK stocks exposed to the domestic economy have been overlooked by the market and are attractively valued despite the gloomy outlook for the UK, says Tim Steer at Artemis.

The co-manager of the £372m Artemis UK Growth fund is buying back into consumer-facing stocks to capture this opportunity, having seen companies exposed to international earnings race ahead. Steer says global growth companies listed in the UK are trading at a 36% premium to UK focused equities, with growth expectations of 12% above UK-focused stocks. This compares with 2010, when the same global growth stocks were at a premium of 19%-20%, while offering an extra 40% growth over UK-focused stocks. He says: “For 2011 we should not disregard some of these UK names. The valuations are a...