Brexit is for good

Brexit is for good

The historical vote of the EU Parliament released Britain from the EU. It means Brexit will be finally delivered, and this very fact will dominate markets performance in 2020. It is essential because sterling pound and UK equities will remain cheap and attractive. Right now, the pound is around 20% below its equilibrium, and the UK equity market is 60% less expensive than fair value. And it does not come unnoticed.

Li Sufu (holder of Zhejiang Geely Holding Group Co.) already owns Manganese Bronze – maker of London cabs and 51% in Lotus among his British acquisitions and is not going to stop. Geely recently emerged as an investor in Aston Martin and is looking towards Jaguar Land Rover for potential technology transfer deal.

Russian tycoon Mikhail Fridman prepared to double his investment in Holland & Barrett (iconic UK health food chain).

Hyundai with its sibling, Kia decided to back the manufacturing of electric delivery vans. It is not a small thing, bringing in £100M for capturing a share of the future green delivery market.

AJ Bell consultancy asked 1400 investors about their intentions for 2020. Investors are going to increase stakes in the UK, Asia and emerging markets. The most attractive sectors are technology stocks, infrastructure and utilities. Mining, oil and retail are considered less attractive. The long term investment arm is steadily put on renewable energy.

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