WHY FOREIGNERS LIKE UK EQUITIES RIGHT NOW
European, and UK, equity markets haven't seen the same steep, fast-paced tech-fuelled gains as some other regions around the world. In large parts, that can simply be explained by the fact that there there just aren't as many tech, chip, and AI-exposed heavyweight companies based across Europe and the UK (besides a select few of course).
But the UK market might still be worth a look - in fact, the lack of tech stocks might be exactly what makes it interesting to some investors.
Domestic institutions are continuing to pull out of UK markets, but there are inflows coming from overseas, Laura Foll, portfolio manger, UK equities, at Janus Henderson said.
"And I think why we're starting to see that interest from overseas is that the UK market can be an interesting source of diversification because we don't have much tech," she said.
"If you're looking to diversify away from tech, the UK market has a slightly different type of company," she said, pointing to mining, oil and gas, banks and financials as examples. "It just has a slightly different sectoral makeup in the UK."
Lipper/LSEG data shows that so far this year, UK equities have seen total net outflows of around $3.4 billion. Stripping out UK-domiciled investors, that number flips to a net inflow worth $2.7 billion, with $1.6 billion in the second quarter alone, according to the data.