Are UK shares an early Christmas present?

first_imgAnd certainly, the great slide in relative valuations that began around the time of the Brexit referendum leaves plenty of room for upside for the Footsie, even if you believe – as I do – that post-election America is looking a little frothy right now. Image source: Getty Images Yet as I also wrote, “Companies – and industries – are recovering at different rates. More than ever, picking the right stocks matters. But the bargains are there.” And if the Footsie had delivered even half the growth of the S&P 500, I calculate that it would be trading at a level of around 8,720 today – roughly 2,000 points higher than where it actually is trading today.A growing chorusOther people are now seeing – and saying – the same sort of thing. In the past few weeks, I’ve seen commentary in several places, all making the same broad argument. The Financial Times, Royal London, Fidelity, Cazenove Capital… and others besides.That isn’t to say that they – or me – are correct, of course. And so on, and so on. Are UK shares an early Christmas present? They certainly were. Industrial firm Weir Group is up 55%. Banking giant HSBC up 25%. Mining group Anglo-American up 44%. Commercial property landlord British Land up 31%. Oil giant Royal Dutch Shell up 26%. Pasty and sausage roll retailer Greggs up 53%. “Right now,” I wrote, “the Footsie looks under-priced. Certainly with respect to America, and – in my view – almost certainly with respect to the real state of the UK economy.”I was rightAs I write these words, the Footsie is now 14% higher than back then. To repeat: the bargains were there, in short. And later that month, and in early October, I made a number of judicious buys for my own portfolio.Upside aplentyYet I reckon bargains are still to be had. Okay, the Footsie is up by 14%. Yet the S&P 500 has risen by 10%. So while the valuation gap has closed a little way, it’s not closed by very much. I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Malcolm owns shares in Weir Group, HSBC, British Land Co, Royal Dutch Shell, and Greggs. The Motley Fool UK has recommended British Land Co, Hargreaves Lansdown, HSBC Holdings, and Weir. Malcolm Wheatley | Sunday, 7th March, 2021 Since February 2016, the Footsie has risen just 18%. (Yes, I know: another 18% rise. But just a coincidence, and over very different periods.)  Obviously, investors’ total returns should be better than that, due to dividend payments.center_img Our 6 ‘Best Buys Now’ Shares Yet for me, my own course of action is clear. I’ve been buying UK equities since September, and plan to carry on doing so. Much as I’m a fan of international diversification, I think that right now, the UK stock market is too big an opportunity to ignore. Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! And that certainly isn’t to say that the valuation gap will close – or even narrow – to any kind of timetable. The UK economy shrank by over 9% in 2020, and – as we all know – a global pandemic is still raging, with new virus variants emerging. See all posts by Malcolm Wheatley Back in September, I pointed out that the UK stock market looked cheap compared to American stocks.As the Covid-19 pandemic took hold in early 2020, stock markets around the world swooned. But by late summer, most had recovered. America’s broadly-based S&P 500 index – infinitely preferable to the tightly-focused Dow Jones – was up 59% from 23 March’s panic-induced slump, and an impressive 4% higher than its 2020 pre-lockdown peak of 19 February.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…But the sluggish FTSE 100, meanwhile, stood at 5,886, a mere 18% up on 23 March’s equally panic-induced low point of 4,994. Simply click below to discover how you can take advantage of this. Enter Your Email Address But on the same basis, the S&P 500 is up 111%. 18% versus 111%? That’s quite a gulf. “This Stock Could Be Like Buying Amazon in 1997”last_img read more