With economic indicators suggesting the U.K. isn't in as dire a condition as predicted, inflation tamed and the possibility of an interest rate cut just who are the beneficiaries?
 
In this Master Investor webinar, Jonathan Davis talks to Sarah Lowther about how a reduction in the Bank of England's base rate could provide a fillip to the stock markets as it offers relief to companies with stretched balance sheets and stimulates the property market.
 
They discuss the perils of elevating fund managers into rock stars and unpick both the open-ended funds and investment trusts that are doing well and the renewables vehicles on course for a rebound. Davis calls out JP Morgan's Global Growth & Income Trust, Greencoat UK Wind and Bluefield Solar Income Fund as investments that have provided solid returns. 
 
"I wouldn't be surprised if you buy them and own them, you're going to get something like nine or ten percent compounded return over a period of years," says Davis who reminds investors that at the same time "You're doing something for the country. You're doing something for climate change."
 
Davis suggests the second quarter of 2024 may not see an extension of the optimism that has buoyed UK markets so far this year. He does though encourage adopting a long-term strategy to combat any short-term frothiness in stock exchanges.

Key moments:

00:00 Intro

00:27 Economic indicators
Despite the UK's recession in the second half of 2023, Jonathan Davis considers the first quarter of 2024 as encouraging, citing economic indicators such as inflation coming down, central banks both in the US and the UK considering interest rate cuts, and the stock market doing well.

01:58 Beneficiaries of interest rate cuts
Jonathan Davis stresses that lower interest rates are beneficial to most people. He highlights some key beneficiaries, though, including people in debt, companies with stretched balance sheets, and the government, which has to service and replace debt.

12:44 The ISA deadline
With the ISA deadline approaching, Jonathan Davis stresses the importance of using up one's ISA allowance, if only in cash. While he considers the best ISA picks to be had in summer, he points to some good offers that are currently available in the cash ISA space.

17:10 Q2/2024 outlook
After a very good first quarter, Jonathan Davis does not expect the second one to follow in its footsteps. Highlighting geopolitical risk and government debt in many developed countries as two major issues that could impact on investors, he does see several opportunities for longer-term returns, though, such as investment trusts, UK equities, the US market, and Japan. In light of uncertainty surrounding interest rate cuts, Jonathan also points out the opportunities offered by cash and in the bond market.

Find out more about past and upcoming Master Investor webinars: https://events.masterinvestor.co.uk

Listen to this webinar as a podcast at

Master Investor website: https://masterinvestor.co.uk/podcast-...
Spotify: https://open.spotify.com/show/63z9slJ...
Apple Podcasts: https://podcasts.apple.com/gb/podcast...
Google Podcasts: https://podcasts.google.com/feed/aHR0...
Subscribe on Android: https://www.subscribeonandroid.com/fe...
Subscribe by Email: https://subscribebyemail.com/feeds.bl...