Warning on stocks from expert

Private wealth management clients were advised today to exercise caution over equities investments.

Adrian Lowcock at Bestinvest said that there remained significant downside risks to stocks - and added that he preferred corporate bonds at the moment.

The comments follow a sharp rise in global markets, which was itself caused by several economic indicators suggesting that the downturn had bottomed out.

In the UK, a report from the National Institute for Economic and Social Research suggested that the recession could have already ended this week.

Meanwhile, daily trades handled by the London Stock Exchange Group have risen by nine per cent, while a poll from the Investment Management Association shows that client confidence has risen above ’neutral’.

Mr Lowcock said: ’In terms of investments we’d probably look to corporate bonds over equities. I think equities probably hold a fair value … but not outstanding value at this time, whereas corporate bonds offer a better risk reward balance than equities.’

He added: ’From an investor’s point of view it is good leaving money in the market at this point of time because it is still quite volatile - there are still some substantial downside risks.’ ADNFCR-2318-ID-19216391-ADNFCR