Andrew Mann, from JM Finn, speaks about the current fall in the FTSE and UK stock market.

It is possible that data this week will once again show UK inflation on the rise, possibly further delaying any cut in interest rates.

The Bank of England, however, predicts that inflation will halve to around 2% over the coming months, probably still allowing it to start cutting later in the year.

Rate cuts should be positive for investors as the cost of borrowing is reduced for both businesses and households, while also making returns on risk-free assets a bit less attractive.

East Anglian Daily Times: Andrew Mann from JM FinnAndrew Mann from JM Finn (Image: JM Finn)

No interest rate cuts are needed to buoy US markets though, with the S&P500 Index closing above 5,000 points for the first time.

The UK market continues to lag and the FTSE100 remains down year-to-date.

While it is easy to point to the higher weighting of technology businesses in the US as the principal reason for its outperformance, it will not stop wider questions that surround the current demise in confidence towards the UK stock market and the businesses listed on it.

In the past few years, a number of UK companies have chosen to sell their shares in the US, with the Cambridge-based ARM one of the most recent.

The microchip designer has seen its share price soar since its float in September, pushed higher by recent hype surrounding artificial intelligence, and at current levels it would only be valued at less than three UK listed businesses – AstraZeneca, Shell and HSBC.

Warnings sounded last year that the London exchange is being sucked into a ‘doom loop’ where valuations are low, liquidity is reducing, and the pool of UK-listed companies shrinking.

While there is undoubtedly a huge amount of apathy towards the UK stock market at present, valuations remain attractive, and my hope is that it isn’t too late to turn things around.