Investors hunting for sizeable
yields are looking to riskier assets — it could point the way
out of the financial lag in the west, says John Redwood
The UK stock market does not have a great deal to do with the
UK economy as the large companies which dominate the FTSE 100 Index
have the bulk of their assets and trading activities around the world
in the larger economies. The profit performance of the smaller companies
in the broader indices is more rooted in the domestic economy.
Like the other major stock markets of the world, the FTSE 100
Index is sensitive to the amounts of liquidity and credit available
in the major centres, to the direction of property and other physical
asset prices, to the prospects for world growth and the outlook for
interest rates. In recent months the outlook has been improving.
