A new survey has suggested that the London Olympics and Queen’s Jubilee will have no impact on the performance of UK Equities.
Responding to their latest Question of the Month, 40% of respondents to an F&C poll believed that these two major events will not have any impact on how equities perform this year.
Only 2% of respondents think that these events will act as a catalyst to kick-start the UK economy.
Almost a fifth of individuals thought these events have in fact created a false sense of optimism amongst investors.
These respondents go further still and believe that UK equities will suffer a significant hangover once the events are over.
Nearly a quarter of respondents believed the potential positive impact of these events has already been priced into the UK equity market, whilst almost a fifth said the events will lead to a temporary surge in UK equities before leveling out by the end of the year.
Based on these views, it would be easy to conclude that nobody really knows what impact, if any, the Olympics are likely to have on the British economy and stock markets.
We saw news earlier this week that Gilts are likely to face some Olympic disruption, as the UK Treasury has called off its weekly gilt auctions for a four-week period between mid-July and mid-August.
The auctions have been postponed due to fears that many bond traders will be working from home, or not working at all, during the Olympics. Disruption to transport is likely to be particularly bad in London during the games.
With those living and working in London (and across the South East) ready for road closures and traffic jams due to the Olympics, it will be interesting to see what impact, if any, the games have on the economy this summer.
Photo credit: Flickr/Sum_Of_Marc
