We had two bank holidays, lockdown eased enough for us to go to the pub indoors, my birthday, Fred’s vaccine and Eurovision. Although, predictably, the UK ended up right at the bottom of the table with ‘nul points’, which is quite impressive really, as some topless Italians rockers won with 524 points! Either our song must have been truly awful, or our European cousins really don’t like us post-Brexit.

Somewhere that we are Top of the Pops (and possibly more relevant to a UK market commentary), is in GDP growth. The Organisation for Economic Co-operation and Development forecast the UK’s GDP is likely to expand +7.2% in 2021, up from their March projection of 5.1%; the fastest among the G7. For reference, the OECD put the US not too far behind, up 6.9% in 2021. Coupled with our vaccine roll out of second doses at 50% of the population and first doses at 75%, we believe we are ahead where it really counts. Obviously, variants remain a risk, but from the outset, the correlation between the hospitalisation rate and the lack of vaccines administered looks high. The key question now is, does Boris and the government open up the economy fully on June 21st or does he apply the brakes for a couple of weeks?

Away from Eurovision, vaccines and GDP forecasts, equity indices have effectively just tracked sideways in recent weeks, albeit we have seen rather a lot of “noise”. The underlying volatility is substantial and led by inflationary fears, which are getting louder and more widespread, and very easily could prove transitory. For all of Bitcoin’s so called ‘inflationary-protection’, there was much more evidence of its idiosyncratic correlation to any asset class – falling 35% on the month. On the other hand, Gold moved higher, up 7.7%. 

Cable reached 1.42, but these moves still haven’t deterred M&A, where the market still sees the UK undervalued. US buyout specialists, KKR, snapped up UK infrastructure investor, John Laing, in a £2 billion deal. In recent months, Marstons, St Modwen, UDG healthcare and Aggreko have all attracted private equity interest – highlighting that UK equities can be shown more love than poor James Newman.