Market Eye from Prest Financial Services

October Market Eye

There is mixed news from the USA where new house building starts are up 15%, but from a very low base and new jobless claims increased after recent declines.There are concerns regarding the

The Bank of England kept the Bank Rate at 0.5% and the size of the Asset Purchase Programme at £375 billion.

The rate of Chinese economic growth is 7.4% for the last year which is just above its’ new target of 7%.The authorities have also increased the money supply which is likely to increase growth in the medium term.There are signs that more production is focussed on their own consumers and less on exports.

The Eurozone saga continues with move and countermove being made by politicians but with not much forward progress being made. However, the longer this continues, the more resilient the financial system should be to the default or exit of a member country.

The FTSE100 slipped from 5,915 on Friday 14 September to 5,896 on 19 October.

PREST’S HOUSE VIEW

POSITIVE VIEW :-

Value Equities – These shares continue to provide strong and increasing income.

Growth Equities – The prospects for shares to increase in price looks good for the medium to long term, but subject to the high levels of volatility we have been experiencing recently.

Corporate Bonds – Non-investment grade bonds provide high yields but their prices tend to move in line with shares. Investment grade bonds continue to provide good, but lower yields.

Read more about Octobers Market Eye from Prest  here