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40% of respondents to an F&C poll believe the Olympics and the Queen's Jubilee will have no impact on UK equities
The Queen's Diamond Jubilee and the upcoming Olympics have not only dominated media attention, it was also the topic of discussion for the latest F&C Question of the Month.
The survey, which canvassed the opinions of visitors to F&C's investment trust website, www.fandc.co.uk/, during June, asked what impact the Diamond Jubilee and the Olympics will have on the UK economy for the second half of the year.
Almost all of the respondents that took part in the survey are not optimistic about the impact the Diamond Jubilee and the Olympics could have on the UK economy, with only 2% of respondents thinking these events will act as a catalyst to kick-start the UK economy.
The majority of respondents (40%) believed that the Diamond Jubilee and the Olympics will have no impact on UK equities whatsoever. Almost a fifth (18%) of individuals thought these events have in fact created a false sense of optimism amongst investors. These respondents go further still and believe that UK equities will suffer a significant hangover once the events are over.
Nearly a quarter (24%) of respondents believed the potential positive impact of these events has already been priced into the UK equity market, whilst almost a fifth (17%) said the events will lead to a temporary surge in UK equities before leveling out by the end of the year.
The Diamond Jubilee bank holiday weekend took place at the beginning of June and created a boost to high street sales, as reported in the CBI's latest monthly Distributive Trades Survey. Whether sales will continue to grow or level out once both events are over, as some of the respondents believe, will remain to be seen.
Phil Doel, manager of the British Assets Trust, comments: "As investors, we have been looking at the companies that could benefit from events such as the Olympics over recent years. Some companies will have profited in the infrastructure construction and other preparations, but as investors there is little upside to be seen looking forward as a direct result of these events.
"Although events such as these will have an effect on sales in the short term, any positive impact on long term equity prices is now reflected."
The full results of June's survey are below. July's question is now online at www.fandc.co.uk/ asking which asset class will perform best over the next 12 months.
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