UK equity market is good value due to de-equitisation

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UBS's Brian Gallagher feels the UK equity market looks good value as solid corporate earnings, attra...

UBS's Brian Gallagher feels the UK equity market looks good value as solid corporate earnings, attractive valuations and M&A activity continue to push share prices higher. Gallagher, who will manage the upcoming UBS UK Equity Income fund, said equity valuations are cheap compared to 10-year gilt yields. He noted: "De-equitisation continues to be a theme for investors and the UK equity market actually reduced in size by 3% during 2006. "This adds to our view that the UK market currently looks pretty cheap." In addition he points to the mega-caps' P/E ratings, which are close to a 20-year...