British shares ended the year in beauty. The London market recorded its best annual course since 1997 and has rebounded more than 50 since the March 2009 low. A few sessions of the end of year, the FTSE 100, 100 stars values index index, and closed Thursday at 5.402,41 points, 4.434 points early in the year, an increase of 21.84.
Among the companies that have distinguished themselves, lots of energy and raw materials such as Vedanta resources or Rio Tinto, banks such as Barclays and Standard Chartered, the British Bank essentially exposed to emerging countries, and values safe such as Burberry and Marks and Spencer. Include conversely difficult year by Royal Bank of Scotland (RBS) and Lloyds, two now almost public banks because of their potentially toxic asset portfolios.
While the British market remains more than 20 below its level in late 1999 after a particularly troubled decade, strategists are considering 2010 with optimism for the London place, while fearing the effects of the withdrawal of support to the economy than the States, and their Central Bank have implemented around the world to avoid that fires a new great depression.
A specific place
London is of course correlated to other European places and Wall Street. But the place has its specificities: the domestic economy of the United Kingdom is not yet out of the recession in the third quarter, unlike that of most rich countries. Elle is weakened by the need to reduce public spending, and the election deadline Elle spring adds to uncertainty. On the other hand, the companies listed in London are very international and exposed to movements in the global economy. According to Morgan Stanley, listed British companies draw 35 of their income only from their domestic market and 20 in emerging countries. Finally, the continental European investor must take into account the exchange rate of the pound. Nomura, the British currency would bounce back. But this will depend on the assessment by the financial markets of the country's capacity to reduce its deficits in the long term.
The British market is "as Chelsea team: its stars are international", so said Kevin Gardiner, responsible for investment in Europe in Barclays Wealth. The profits made by big British companies abroad will allow a rebound "V" rated values profits next year, and the FTSE 100 should be, according to him, 5.700 points. Nomura anticipates a FTSE 100 at 6,000 points late 2010 and increases in profits for the companies listed in London from 28 against 18 in the rest of Europe. However, if many strategists predict a sustained increase in business profits next year through the rebound of the economy, it is possible that the equity markets react badly when support measures will be removed. London will not escape this rule, as the Bank of England, with a monetary creation of 200 billion pounds, went very far. Teun Draaisma, strategist at Morgan Stanley, focused its attention on this aspect to give its year-end forecast: he thinks that the stock market rally will continue in the short term, but that the FTSE 100 to 5,000 points return end of December 2010.
Small review of the most significant innovationsThey are likely to be four to want to shareWe will slowly die if we remain in a national visionAt least for those in the sector of consumptionAt Abbeville where he is sent to boarding school alsoThe year 2010 is not Announces simple for JeanLouis BorlooBut the key for him is to disconnect the subject of election issuesThe neverseen since the creation of the euro59 yesterday at the London Stock ExchangeThree months later he died at the hospital
