UK shares skyrocket as the markets react to the Brexit deal being finalised. Since the announcement on Christmas Eve, the FTSE 100 and 250 were up about 2% reaching a nine month high. This great news was doubled with optimism towards the vaccine plan marking a possible end to the pandemic with the Oxford – AstraZeneca vaccine being approved for use in the UK this morning.
For a long time the Brexit deal has tested everyone’s nerves, but now the deal has been finalised, that uncertainty has washed away. UK share investors typically receive an annual return of 8% to 10% of their investment and now the odds will be even greater if you buy during the current recession.
Brexit deal boosts UK stocks and crashes banks
With the FTSE 100 closing the highest in almost 10 months things are looking up. Manufacturing was among the top risers with Halma up 4.8%, Diegeo up 4.4% and Smith & Nephew up 4.2%. Despite the good news about a Brexit trade deal being passed, banking shares fell across Europe with fears of the coronavirus pandemic having an ongoing effect on the global economy. Banks fell the greatest among all stocks with Lloyds suffering the greatest at -4%. This drop is also attributable to the lack of agreement on financial services in the Brexit deal.
The Brexit agreement also saw UK citizens elated at the news that pension funds and investors on the London stock market are due to receive £145 billion in aid. The relief package is an outcome of the agreement between the UK and EU discussions on business support. With this new funding as part of the finalised Brexit deal, a rise in the UK stock markets was a sure thing.
In other news, the vaccine has boosted shares and given optimism to the industries worst hit by the pandemic, with the travel company Intercontinental Hotels Group rising 4.2%. Vaccine development, AstraZeneca, has also done well seeing a 3.9% boost just after the Brexit deal was finalised last week. With their vaccine approved for use in the UK this morning, there is likely to be a rally. Back in 2012 their share prices were £30 and have been on the up and up ever since with highs of £96 this summer taking over Unilever in the FTSE 100. With a small blip in their records this year after buying Alexion at a 45% premium they have turned it back around with the recent approval of the cancer drug Lynparza and the coronavirus vaccine approved in the UK today. Analysts predict AstraZeneca will rise over 2021 but is unlikely to be the greatest riser in the FTSE 100 next year. Will you buy Astrazeneca shares before the vaccine is approved?
Stocks to buy
AstraZeneca is doing unbelievably well and it’s time to buy, just as the UK approves their coronavirus vaccine, AstraZeneca shares will rally.
Auto Trader is optimistic about its long-term prospects selling vehicles to UK markets in a post-Brexit world where other companies are restricted.
Burberry, with its popularity across the globe is going to have a good 2021, especially after barriers to the European market have been quashed with the Brexit deal finalised and huge growth in the Asian market driving further expansion.
Grainger, who are developing more and more affordable homes in the UK, are expected to sky-rocket as rent increases and more people opt to own homes.
Reckitt Benckiser is the leading consumer goods company and their cleaning brands Dettol and Lysol are performing well considering the current concern for hygiene. Its third quarter results showed a like-for-like growth of 13.3% boosting prospects for the year to come.
Segro, a real estate investment trust who focuses on warehouses, has had strong performance this year with the phenomenal growth of online shopping. With this set to continue, investing now could add a low risk high reward stock to your portfolio.
Wizz Air shares will likely rise due to optimism that airlines can recover and evidence the flight paths they serve are growing in popularity with passenger growth at 10%. It has proved it can survive this year so now may be the best opportunity to buy before the travel sector takes off.
Overall, analysts predict markets will not see the full effects of the Brexit deal until the pandemic has receded, allowing for economic recovery. The double-dip recession brought about by new virus strains have made investors hesitant yet investing in sturdy UK stocks while they are relatively low will reap profits when the economy bounces back. Stay up to date with the latest stock market news with BullBear.