UK/GLOBAL- The world’s major equity markets showed weak signs of recovery in the first quarter of 2002 according to the latest CAPS pooled pension fund survey.
CAPS says that in sterling terms, there was little to distinguish the major markets. Europe ex-UK, the US and the UK each returned 2.3% in the first three months of the year while emerging markets provided 13.8%.
UK fixed income was the only asset class to produce negative returns, down 60 basis points in the year to March. Overseas bond were 0.7% in the black while property and cash continued to produce positive returns of 0.6% and 0.9% respectively.
CAPS’ data represents over £212bn in UK pension funds pooled assets and suggests that schemes are regaining a little confidence in the equity markets. Cash holdings fell from 4.7% to 4%, its lowest level since 1995.
Over the quarter, equity weightings in balanced funds rose 0.8% to 54.1% in the UK and from 27% to 27.7% overseas, predominantly to Europe and Pacific ex-Japan.
In the UK market, medium-sized companies fared the best with the FTSE 250 returning 4.5% over the quarter. Returns for both the FTSE 100 and Small cap indices were below the All-Share return.
As with last year value stocks continue to outperform growth stocks. Returns were 7.6% and –4.3% respectively.
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