Pre-election polling promises ‘dull’ and therefore stable politics and boosts case for investing in UK
: Darren Staples/Bloomberg
Traders are being urged to buy British stocks and bonds amid predictions of a crushing Labour election victory.
Analysts at top banks and brokerages said the UK is currently one of the best bets for money managers, partly due to a perceived lack of political volatility compared with countries such as France and the US.
Since the start of the six-week election campaign, Labour has been on course to win the election with a poll lead of around 20 points that has barely changed.
That has put Sir Keir Starmer’s party on a path to win a historic majority of more than 200 seats, according to a final set of predictions by pollsters on Wednesday night.
Against that backdrop, analysts at Citigroup and Dominion Bank have recommended buying UK gilts and fund managers surveyed by Bank of America said the UK was now their most favoured European equity market.
Meanwhile, the pound has been trading at its highest level against the euro in almost two years, with £1 currently worth about €1.18, and the FTSE 100 and 250 indexes are both rallying as of Thursday morning.
The UK’s political scene – where one mainstream party looks on course to win a large majority – compares with other countries such as the US and France, where potentially volatile elections remain too close to call, analysts suggested.
Jane Foley, head of FX strategy at Rabobank, told Bloomberg: “Dull politics is good for investment.
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