Emerging market drivers

ON UK INCOME

The eurozone continues to cast a cloud over markets. There is evidence of change happening, but it is not taking place at the pace markets want.

Strategic corporate decision making has slowed as a result, with M&A activity dwindling, capital decision making stalling and companies rotating bank debt into corporate bonds. There were signs towards the end of Q2 that companies would increase their investment spend, but this is clearly not yet happening. While Q2 reporting figures are down marginally, we have not seen the freefall that markets feared in the majority of sectors. We are seeing dividend growth coming through in the main from UK companies. In fact, at present we have seen no dividend cuts from UK companies that we  follow...