Outlook 2015: UK Equities

UK equities have not had the best year, but as 2014 draws to a close, what can investors in domestic stocks expect from the next 12 months?

Franklin Templeton Investments 16 December, 2014 | 11:03AM
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Morningstar's "Perspectives" series features investment insights from third-party contributors. Here, Colin Morton, Portfolio Manager, Franklin UK Equity Team, comments on the outlook for UK equities in 2015.

Our outlook for 2015 is more of what we’ve seen over the past several years. We remain very solidly in an era of low interest rates, low bond yields and modest returns. The US economy is performing very well but Europe continues to struggle, aside from the UK. Japan has a big quantitative easing programme aimed at getting long-term inflation up towards two percent but there’s very little success so far. Emerging-market economies are generally also finding times quite tough with growth slowing and some countries having debt issues – although there are exceptions and these markets should not be viewed as a single block. More recently, economies that are exposed to oil have been starting to feel the influence of its price collapse as well.

In summary, while the US looks okay, Europe is flat with the UK hopefully continuing to be the exception, albeit perhaps with some bumps in the road ahead.

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Franklin Templeton Investments  is one of the world's largest asset management groups, offering UK investors a range of over 80 funds across different market sectors.