UK equity update: inflation, interest rates and a mini-budget

  • |
  • 07 mins 30 secs

Learning: Unstructured

Author: Ciaran Mallon, Fund Manager

The third quarter was another turbulent and eventful one for the UK stock market. Inflation, interest rates and a mini-budget were on everyone’s mind.

With markets expecting further rate increases later this year, what might lie ahead? Is inflation nearing its peak? And with the earnings of over two thirds of listed companies on the UK stock market coming from overseas, how might that impact the outlook for UK equities?

Ciaran believes markets will remain unsettled but is cautiously optimistic about 2023.

In his Q3 video update, Ciaran answers the following questions:

  • 00:15 - What has been happening in the UK equity market over the last quarter?
  • 01:51 - How did the UK Equity Share Portfolio perform over the quarter?
  • 04:37 - What changes have been made in the portfolio over the last quarter?
  • 05:37 - What is the outlook for UK equities?

Recorded on 13 October 2022

Investment risks

The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.

The use of borrowings may increase the volatility of the NAV and may reduce returns when asset values fall.

The Invesco Select Trust plc uses derivatives for efficient portfolio management which may result in increased volatility in the NAV. In addition, some companies are suspending, lowering or postponing their dividend payments, which may affect the income received by the product during this period and in the future.

The Invesco Select Trust plc UK Equity Share Portfolio invests in smaller companies which may result in a higher level of risk than a product that invests in larger companies. Securities of smaller companies may be subject to abrupt price movements and may be less liquid, which may mean they are not easy to buy or sell.

Important information

For professional clients in the UK only and not for consumer use.

All information correct as at 13 October 2022 unless otherwise stated.

This article is marketing material and is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication.

Where individuals or the business have expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice.

For more information on our products, please refer to the relevant Key Information Document (KID), Alternative Investment Fund Managers Directive document (AIFMD), and the latest Annual or Half-Yearly Financial Reports. This information is available using the contact details shown.

Further details of the Company’s Investment Policy and Risk and Investment Limits can be found in the Report of the Directors contained within the Company’s Annual Financial Report.

Issued by Invesco Fund Managers Limited, Perpetual Park, Perpetual Park Drive, Henley-on-Thames, Oxfordshire RG9 1HH, UK. Authorised and regulated by the Financial Conduct Authority.

EMEA 2579871 /2022

Channel: Invesco


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