The FTSE 100 reached an all-time high this month, breaching its May 2018 record of 7,903 points. However, the latest Q4 GDP estimate did not reflect this optimism. A recession may have been avoided so far, but UK economic growth is flat with data showing no growth in the final quarter of 2022.1
Against this backdrop of clear disparity between the domestic economy and the UK blue-chip index, Alex Wright, Portfolio Manager of Fidelity Special Situations Fund and Fidelity Special Values PLC, explains why the FTSE 100 performance does not present a full picture of UK equities and outlines the opportunities available for value-focused investors.
“The UK’s blue-chip index reaching a new all-time high comes on the back of a resilient 2022 performance relative to other global indices, returning 5% including dividends versus an 8% fall for the S&P 500 and a 25% drop for the Nasdaq (in pounds)2. Positive performance of the index has been largely driven by sectors such as energy, mining and banks which have benefited from the macroeconomic backdrop of rising energy prices and higher inflation...”
Fidelity Special Values PLC (LON:FSV) aims to seek out underappreciated companies primarily listed in the UK and is an actively managed contrarian Investment Trust that thrives on volatility and uncertainty.
