UK stocks have enjoyed a tremendous climb throughout the month of December, following the election. The billions of additional invested pounds represent the largest influx of money since the referendum.
New Life in London-Listed Shares
Nearly £4 billion has been injected back into investment funds for London-listed shares since the start of the election. This has sent the largest amount of money into U.K. stocks since the EU withdrawal referendum.
This is viewed as a direct reflection of recovering investor confidence following the solid Boris Johnson election victory. Stocks that have been greatly abandoned or ignored since the Brexit referendum have now seen an additional £3.8 billion added to their market, according to EPFR Global data firm figures.
Throughout the majority of 2019, UK equity funds have been bleeding money. That said, throughout the holiday season, they have experienced the highest return of funds since the second half of 2015.
UK Stocks Returning to Health
Following the Conservative Party’s win, the FTSE experienced several consecutive days of gains. In fact, after the first 9 days, it had gained 371 points, that is, 6 percent. That brought £93 billion to the largest listed companies in the United Kingdom.
Similarly, the FTSE 250 rose by 1,266 points, also 6 percent. This increased that mid-sized UK company index’s value by £23.2 billion. Those gains represent the largest winning streaks the country has seen in three years.
While it has been attributed with the Boris Bounce, it has helped the UK keep up with growth seen in markets around the world. Other major markets have also experienced positive growth throughout December.
The election results were what brought investor confidence to a level that brought London-listed stocks into this trend.
UK Solidity
“Boris Johnson’s win provides the much-needed solidity the UK has been craving. Businesses can begin to see their future, now Brexit is confirmed to go ahead,” said Kerstin Braun, president of the Stenn Group finance company.
“It’s unlikely a trade deal will be decided until the end of 2020 so it’s vital firms start investing again as they exit the Brexit limbo. This is critical for long-term growth.”