NatWest Group PLC's (LSE:NWG) recent rerating has been achieved without significant levels of growth in the UK economy, for which it is largely a proxy, notes Peel Hunt.
But with the UK economy seemingly picking up that might be about the change.
Hiscox Ltd (LSE:HSX) numbers underlines the attractive conditions available in the reinsurance sub-sector, where management is leaning into decent margins by retaining more premiums on its balance sheet, says Panmure Liberum.
“There is also a pickup in both top-line growth and margins across the Retail division as a refocus on the US partnerships and recent marketing spend starts to gain traction.
London’s FTSE 100 blue-chip index is within a whisker of its all-time high, and a couple of brokers suggest it might soon pass the milestone and move into new territory over the next few weeks.
JP Morgan sees the UK and Japan as its two favourite strategy picks at the moment, driven largely by the down move in bid yields, which favours defensive sectors.
UK banks are still in favour with UK bank Citi after the latest chunk of Bank of England mortgage data.
Indeed, the only negative Citi can find is an uptick in the deposit-mix shift, but even here there is lower than last year it says and deposit activity overall is stable.
Vertu Motors (AIM:VTU)’s update on Monday gave a stark view of how new government-mandated targets on electric vehicle sales were hitting the market.
“Volatility and negative impacts” from government targets left new car volumes 5.8% lower over the first half of the year, the retailer said in the update, as manufacturers faced requirements to make up a proportion of their sales with electric models.
LBG Media PLC (AIM:LBG) is highlighted as a potential beneficiary of a rebound in the fortunes of the UK economy.
According to research carried out by Peel Hunt, there are three key reasons to be more optimistic about stock market-listed companies: They have healthy balance sheets, improving fundamentals and are now operating against a politically stable backdrop.
Morgan Stanley (NYSE:MS) upgraded its view on European real estate and UK property developers in particular, seeing confidence returning to a sector where "balance sheets are healthy and assets have been marked down".
Analysts at the investment bank upgraded their stance on the wider European property sector and said they were now "unequivocally bullish" on UK real estate investment trusts.
London-listed companies are on course for a “protracted period” of growth as the UK economy rebounds from several years of high inflation and uncertainty.
Peel Hunt analysts said in a note on Monday that a “mood change” across the UK should feed through to better earnings and growing investor confidence over the coming years.
After Rightmove PLC (LSE:RMV) shares jumped 20% on the confirmation from Australia's REA Group (ASX:REA) that it was considering a bid, analysts said the situation could get "messy".
Aussie-listed REA Group, which is 61%-owned by Rupert Murdoch's NewsCorp, said in a statement it has yet to approach Rightmove, though it is mulling an offer made up of cash and shares.