Fund Objective

There is no fund objective available from this fund manager.

View on Past Performance

The FTSE 100 recovered steadily during 2003, after a sharp recovery from lows in March - this was caused by decreasing uncertainty over war in the Middle East, and June interest rate reductions in the US and Europe. The Upward momentum has lessened in 2004, with UK interest rates increasing in two stages to 4%, and concern over bombings in Spain and elsewhere. The recovery in the market has been lead by housing stocks, technology and other non-cyclical stocks such as healthcare and tobacco. The strong crude oil price has helped to worries about rising interest rates and the high level of consumer borrowings, while telecoms also performed poorly - BT announced that is would be returning capital by a share buyback programme. The improving economic picture does not appear to have fed through to company profitability in all market sectors.

Future Expectations

We have a positive outlook for the UK market. The recovering domestic economy, and improving international picture should follow through into improved corporate earnings, which should in turn support higher valuations. Rising oil prices have contributed to economic uncertainty. If transportation costs increase this will have a general depressive effect on economic output. The prospect of continued fighting in the Middle East, and especially Saudi Arabia, clearly is contributing to a high oil price Prospects for a quick return to stability look limited, although uncertainty should reduce after the US presidential elections in November, which would be positive for the market.

Fund Details