Global Stock Market Volatility
Global Stock Markets have remainied highly volatile this week following renewed concerns over the US slow down and the global credit squeeze.
Our view is that the stock market will remain volatile for the foreseeable future and the sudden dips and spikes will offer buying and selling opportunities for fund managers to enhance performance over the medium to long term.
The fundamentals show that the UK stock market is at similar relative value in terms of price/earnings ratios and dividend yields, to the decade low in March 2003. Therefore, value represents opportunity and we suggest that now is a good time to invest, or increase stock market weighting within portfolios on a year to 18 month view.
With a substantial correction in UK Commercial Property values in 2007, this sector is beginning to look as if it has reached the bottom, although there may be additional write downs this year.
The old adage of ‘buy low, sell high’ remains firm.