​ May confidence vote makes UK stocks a bargain, says Buxton

By Michael Klimes

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Dec 14, 2018

UK stocks have fallen to bargain prices and investors should look closely at them, according to start fund manager Richard Buxton.

Last night prime minister Theresa May survived a no-confidence vote as she won the support of 200 Tory MPs against 117 who voted against her.

Fund managers have argued that the confidence vote could contribute to volatility in financial markets, but should benefit shrewd investors.

This is because the vote presents opportunities for investors looking to buy UK equities at reduced prices.

They add the parliamentary vote on May’s Brexit deal is unlikely to be straightforward, however, and will test her authority to secure a deal with the EU.

Merian Global Investors head of UK equities Buxton says: “As a UK equity investor, my view is that we have now entered the bargain basement buying zone for domestically focused stocks.

“With some shares down up to 40 per cent from their 12-month peaks, there are some extraordinary opportunities to be seized; it is now, more than anything, a question of timing when to press the ‘buy’ button.”

Franklin Templeton head of European fixed income David Zahn adds it makes sense to be active in the management of fixed income portfolios in the wake of the political instability.

He says investors will likely have to react to more news flow coming out from Westminster and Brussels.

Zahn also says it may be difficult to understand what is happening, but for those investors who can, there may be an opportunity to add value to their portfolios.

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