Newspaper article Evening Gazette (Middlesbrough, England)

UK to Fair Better despite Volatility

Newspaper article Evening Gazette (Middlesbrough, England)

UK to Fair Better despite Volatility

Article excerpt

Byline: By SARAH JUDD

A TEES Valley stockbroker said UK markets should not be as badly affected as the Dow Jones, despite market volatility which saw the FTSE 100 down 16 points within an hour of opening today.

Anthony Platts, divisional director of Wise Speke, said despite the global credit crunch, which saw Asian shares slide heavily on the back of heavy Wall Street losses, the FTSE would fair better.

"The fact we were down 16 points after less than an hour of trading is not too bad considering how far the Dow Jones in the States fell last night," he said.

"The UK should not be as badly affected as the US through the problems in the sub-prime market, and at some point, the market will be in a technically oversold position where the share prices have gone beneath fair value.

"It will continue to be volatile for a while, but what may provide some respite is cuts in interest rates in the near future."

The British Chambers of Commerce (BCC) has also reiterated calls for the Bank of England to cut interest rates after "disturbingly weak" export data suggested the economy was heading for a marked slowdown.

The BCC urged rate setters at the Bank's Monetary Policy Committee (MPC) to bring rates down from 5.5% as it unveiled the results of its latest quarterly economics survey.

The poll of 4,600 British firms showed a worrying drop in activity in the manufacturing and service sectors, with businesses also saying they intend to put employment and investment growth on hold.

But the survey revealed that pricing pressures for manufacturing and service firms were running at their highest in more than 10 years, signalling tough times ahead for the MPC to keep inflation under control, according to the BCC.

David Kern, economic adviser to the BCC, said: "The latest results show the tough position that the MPC is in as it contemplates its next move. …

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