London Daily

Focus on the big picture.
Tuesday, Aug 11, 2026

'Pretty compelling': UK stocks at valuations not seen since 2008, analyst says

'Pretty compelling': UK stocks at valuations not seen since 2008, analyst says

U.K. stocks are "really cheap" and are a "pretty compelling" buy right now but Brexit is complicating the investment landscape in Britain, an investment analyst told CNBC.
“U.K. stocks are now at valuations last seen in 2008-2009,” Emma Wall, the head of investment analysis at Hargreaves Lansdown, said.

“Even stripping out banks and the mining stocks - because people always say the U.K. is cheap because you’ve got mining stocks which are just not going to last with the rise of popularity of ESG-investing (sustainable investing) and the banks are so linked to recession that that’s what’s dragging down U.K. valuations - even stripping them out ... they are really cheap.”

U.K. stocks have taken a hammering since the coronavirus pandemic emerged in Europe in early spring, with the FTSE 100 down 21.5% year-to-date. Aside from the economic damage wrought by the virus, U.K. market sentiment has been buffeted by ongoing uncertainty over Brexit.

Negotiations between the U.K. and EU to establish a trade deal once the transition period ends in December have not yielded an agreement so far, with differences remaining over state aid rules, fishing rights, and customs rules in Northern Ireland, which will become the U.K.’s only land border with the EU.

Tense talks so far have raised the prospect of a “no-deal” scenario in which both the U.K. and EU could put tariffs on each other’s goods and trade becomes more convoluted and costly.

A no-deal scenario would very likely lead to a depreciation of sterling against other major currencies that could boost the attractiveness of U.K. stocks, but Wall said the situation was not that simple in the case of a no-deal Brexit.

“If there’s no Brexit deal, that will have an impact on the pound, but it will also have an impact on sentiment,” she said.

“We’ve seen hedge funds, since 2016, going short on U.K. because of the Brexit uncertainty, and we are seeing the U.K. make up a smaller and smaller part of those broad, global indices, from the FTSE to the MSCI. So of course those passive funds are buying less of the U.K., so it’s a complicated thing to work out because it’s not as simple as ‘sterling down, FTSE up’ because you also have that extra layer of uncertainty.”

“Having said that, at these prices, if you’re talking a long-term view, the U.K. is very cheap. Although it might be a bumpy ride over the next six to 12 months. (But) in the long-term view, these prices are pretty compelling,” she said.

With three months to go before the transition period ends, and no deal in sight before a forthcoming EU summit in mid-October, by which time it was hoped a deal could have been reached, “significant risks remains,” according to John Wraith, head of U.K. rates strategy at UBS.

Writing in a note Tuesday, Wraith said that UBS still expects “major disruption to be avoided,” however.

“We expect both sides to keep working towards an agreement beyond the mid-October EU Summit - even though that has been identified by the U.K. as the deadline for a deal - and believe the mutual determination to avoid compounding the economic challenges posed by the Covid-19 pandemic should ultimately ensure that disruption to trade and economic activity at the end of the transition period is minimal.”
Newsletter

Related Articles

0:00
0:00
Close
Donald Trump Warns FIFA Against Ousting Gianni Infantino Amid Revolt by Global Football Leaders
Nicola Sturgeon Says She Has No Contact With Estranged Husband After SNP Embezzlement Case
Police Arrest Two Men After Aberdeenshire Defense Technology Office Break-In
Greater Manchester Councils Gain Powers to Restrict New Vape and Betting Shops
Coroner Finds Treasury Workplace Failures Contributed to Personal Assistant’s Suicide
English and Welsh Courts Ban Meta Smart Glasses Over Recording and Privacy Risks
Strait of Hormuz Disruption Could Double UK Inflation and Trigger Recession, Forecasters Warn
UK Expands Global Talent Visa Scheme to Support Research-Intensive Companies
UK Equity Funds Suffer Record One Point Six Billion Pound Outflow Amid Capital Gains Tax Fears
Three-Quarters of England Enters Drought as Fifth Summer Heatwave Raises Economic Risks
UK Hiring Stabilizes for First Time Since 2022 as Employers Adjust to Higher Payroll Costs
UK Chancellor Orders Whitehall Spending Cuts as Public Debt Exceeds Three Trillion Pounds
UK Manufacturing Output Records Fourth Straight Month of Growth
UK Condemns Russian Torture of Ukrainian Prisoners and Recruitment of Foreign Nationals
Long-Lost Royal Navy Warship HMS Tiger Found in English Channel After 118 Years
Northern Ireland Finance Minister Seeks Urgent Treasury Talks Over Regional Budget Pressures
UK Government Targets Subscription Traps and Misleading Discounts in New Consumer Rules
Alleged Cartel Boss Daniel Kinahan Extradited From Dubai to Face Criminal Charges
AI Chatbots Challenge Traditional News Consumption and Raise Job Concerns
Andy Burnham Government Promises Crackdown on Exploitative Business Practices
UK University Funding Model Faces Growing Pressure From Unsustainable Student Debt
Government Urged to Subsidise Energy Bills for Vulnerable UK Households
UK Military Spending Plans Threaten to Deepen Infrastructure Funding Gap
Israeli Government Rejects US Peace Framework for Gaza
New Labour Government Signals Closer Economic and Strategic Ties With European Union
Amber Heat-Health Alerts Issued Across England as Temperatures Threaten 36 Degrees
UK Economy Expected to Grow Despite Energy and Supply Chain Shock From Iran Conflict
Foreign Social Media Accounts Drove Disinformation During Belfast and Southampton Riots
Record Number of Migrants Cross English Channel in Single Vessel as Smugglers Deploy Mega-Dinghies
Russia’s A7 Builds a State-Linked Payments Network Beyond Western Sanctions
Reports of Mark Zuckerberg-Linked Superyacht Declining Rescue Assistance Draw Maritime Scrutiny
Preserving Three Banksy Artworks in London Has Cost Taxpayers Nearly £150,000
Four Ugandan Athletes Disappear From Delegation After UK Sporting Events
French Authorities Report Channel Interventions as Cross-Border Migration Dispute Continues
Home Office Admits Error in Settled Status Case Involving Long-Term Italian Resident
Unite Calls for Independent Review of UK Budget Watchdog's Fiscal Forecasting Rules
Thinktank Calls for £175 Annual Energy Bill Cut for Low-Income Households
Foreign-Linked Social Media Accounts Amplified Recent Unrest in Belfast and Southampton, Analysis Finds
London Mayor Sadiq Khan Orders Westminster to Drop Proposed Soho and West End Hospitality Ban
Royal Navy Deployments to Monitor Russian Activity in UK Waters Rise 25 Percent
UK Economy Expected to Grow 0.4 Percent in Second Quarter Despite Geopolitical Pressures
Andy Burnham Launches Cost-of-Living Measures Targeting Subscription Traps and Misleading Discounts
Hyper-Realistic Reborn Dolls Draw Collectors Seeking Comfort and Craft
Gen Z Cuts Back on Dating as a Night Out Nears $200
Patients Turn to Artificial Intelligence for Therapy as Psychiatrists Warn of Privacy and Clinical Risks
Couples Embrace ‘Sleep Divorce’ to Protect Rest and Reduce Tension
Meta Ordered to Pay $567 Million and Change Facebook and Instagram Safeguards for Children
Up to only 10 Months in Prison for Swedish Officer’s Murderer Sparks Anger
Success: Nvidia Turned Gaming Chips Into the Engine of the AI Boom
Jorge Messi, Lionel Messi’s Father and Longtime Agent, Dies at 68
×