Where next for the UK market?

Bradbury on the UK

UK equities have continued to trade in a broad 10% range in recent months as sentiment has waxed and waned, with risk on in July, off in August and back on again in September.

At some point the trading range will be broken, the question is which way? The bears argue recent softness in US economic data provides a clear indication the economic recovery is stalling and therefore company profit expectations for 2011 are too high. Ultimately, the argument goes, profit disappointment coupled with a realisation the authorities’ economic policy locker is nearly empty will lead to further falls in share prices. However, I am more persuaded by a range of positive arguments. Yes, economic recovery in the Western world is slower than might generally have been hop...