The FTSE 100 index today moved higher on the back of strong results from AstraZeneca, Rolls-Royce, BAE systems, Cobham and BT. The index has been fairly volatile over the last couple of months although over the last couple of weeks there has been a significant rebound in investor confidence and indeed in the FTSE 100 index. However, is this really a turning point for the UK economy?

While there's no doubt that short-term sentiment has benefited from improvements in the trading environment for a number of companies in the UK, we are nowhere near over the worst. On the surface a number of companies have reported better-than-expected, on not as bad as expected, results which have led to a short-term sigh of relief. Whether or not this momentum will carry on over the next few weeks remains to be seen but there is no doubt it will be set against a very difficult economic backdrop.

There will always be companies "bucking the trend" but investors need to look at the wider picture, economic forecasts, the property market and comments from the Bank of England specifically. While Mervyn King has remained fairly upbeat, at least until yesterday, with regards to the UK economy even he is now showing signs of doubt with regards to forecast for UK economic growth in the short term.

»» Return to Homepage

»» Full Investments News Archive

»» Offshore Bank Account