The FTSE 100 has leapt in 2024 as demand for UK stocks in general has improved. At 8,283.36 points, London’s premier stock index has risen an impressive 7% in value.
If an investor survey by Charles Stanley is accurate, the Footsie will print further gains over the next six months.
71% are bullish
The financial services giant questioned 1,007 so-called DIY investors as to where they think the index will go between now and early 2025.
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A whopping 71% of these said they expect it to rise in value over the period. Moreover, 40% of them said they’d raised their Footsie exposure in the last three months.
Charles Stanley’s research shows that investors are also bullish on UK mid-cap shares for the next six months. Some 35% of respondents have boosted their stake in FTSE 350 companies since early May. And 28% said they’d increased their exposure to Alternative Investment Market (AIM) shares.
Britain’s back in vogue
In fact, the report suggests that demand for UK assets overall has improved, with demand for corporate and government bonds also picking up.
Brighter economic data, allied with hopes of a more stable political landscape, have bolstered confidence in Britain again following years of share price underperformance. In fact, Charles Stanley says that investor interest in UK blue-chip shares is higher than demand for overseas stocks.
As I mentioned, 40% of respondents said they’d bought FTSE 100 stocks during the past three months. This is higher than the 33% that have increased their exposure to US stocks, and the 29% and 25% that boosted their stake in European and Asian equities, respectively.
Thinking long term
Rob Morgan, chief investment analyst at trading platform Charles Stanley Direct, said that “after a sticky start to 2024, facing high inflation, high rates, a recession risk, and geopolitical chaos, the FTSE has emerged victorious.”
He noted that “by being ahead of the curve, this positions DIY investors to realise their financial ambitions faster and more effectively than their passive peers.” But critically, he added that “all investors should be following the same rules; investing for the long-term, with a diversified portfolio, and [requesting] advice where appropriate.”
This is a critical point to make. Financial markets can be extremely volatile. They can soar, or they can plunge, at a moment’s notice on a wide spectrum of economic and political factors.
As a result, it’s a good idea to follow billionaire investor Warren Buffett‘s strategy. His advice? “Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
A top FTSE share
Unilever (LSE:ULVR) — whose share price has soared 26% so far in 2024 — is one Footsie share I’d buy to hold for the long term.
The prospect of more mighty gains this year is an attractive prospect. But it’s not a gamechanger for me. In fact, its impressive price gains this year could leave it vulnerable to a price correction if newsflow suddenly worsens.
I’d buy Unilever shares if I had cash to spare because of its exceptional profits outlook for the next decade or more. I like its massive emerging market exposure where consumer spending is growing at rapid pace. Underlying sales in these new regions rose an impressive 5.1% in the first six months of the year.
With heavyweight labels like Dove soap, Persil detergent and Hellmann’s mayonnaise, the firm looks is in great shape to capitalise on surging global consumer goods demand.
