Identifying recession survivors is vital for long-term prospects

ON UK INCOME

Royal London's Martin Cholwill discusses which sectors are currently offering the best opportunities.

Although we face an extended period of anaemic economic growth in the UK, that does not mean the equity market cannot do well. Having planned for a full-blown depression, companies were generally able to cope very well with what turned out to be ‘only' a recession. Having taken difficult cost-cutting decisions at the low point of the cycle, companies are now reaping the benefits and in some cases profit margins will exceed previous peaks. Consequently, underlying corporate cashflow is strong and balance sheets are repaired. This combination of robust cashflow and balance-sheet stre...