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It has been a robust yr up to now for a lot of UK shares.
The FTSE 100 has had a storming 2025 up to now, for instance.
It’s up 18% because the begin of the yr and has repeatedly set new all-time highs alongside the best way. The FTSE 250 is up by a extra modest 7%, whereas the FTSE All-Share has moved up 16%.
May issues maintain going properly – and maybe proceed that means after subsequent month, as soon as 2025 provides technique to 2026?
A robust market amid a combined enterprise surroundings
I believe that there may, doubtlessly, be extra sturdy efficiency forward of us.
In any case, UK shares have accomplished properly total in 2025 despite the fact that it has been removed from a banner yr for the British economic system.
Development has been sluggish, and lots of companies have complained a couple of rising tax and regulatory burden consuming into their profitability. Client demand has been sluggish and there are many indicators of tightening belts.
But that has not stopped the British inventory market from powering forward.
So I reckon it may maintain doing properly even when the economic system stays sluggish. If there are clearer indicators of progress, that would assist assist an excellent greater inventory market.
Not immune from the worldwide image
Then once more, we may but see the inventory market wrestle between now and the tip of the yr. 2026 might not be a superb one.
Why? Other than the British economic system, the worldwide image additionally weighs on the London market.
If there’s weak spot in world markets, that would damage investor confidence in Britain and damage UK shares, even when Britain itself is doing positive.
We have now already seen this in 2025. Whereas it’s straightforward to give attention to the Footsie’s total sturdy efficiency up to now within the yr, that has been removed from a easy experience. The shock US tariff announcement in April shook markets on each side of the pond.
The worldwide economic system continues to look fragile. Geopolitical dangers stay elevated. That would weigh negatively on the London market.
Right here’s my strategy as we head in direction of 2026
Clearly, no person is aware of for positive the place the inventory market would possibly go from right here.
No matter occurs to the broader market, although, some particular person shares could also be costly whereas others are low cost.
That’s the reason, slightly than shopping for the market, I’m on the lookout for particular person UK shares so as to add to my portfolio.
One I’ve purchased in latest months is scientific instrument maker Judges Scientific (LSE: JDG).
The worldwide financial weak spot and geopolitical dangers I discussed above have damage Judges. Demand in some markets together with China stays subdued.
Some US academic establishments have seen budgets slashed. I see that as an ongoing threat for Judges’ revenues and earnings.
However the medium-sized UK firm has constructed a worthwhile enterprise focussed on a market the place prospects are keen to pay premium costs for top-quality merchandise.
Over the long term, there shall be sustained demand for measurement devices. Judges has been cautious to not overpay for acquisitions. Its centralised enterprise companies imply it could wring efficiencies out of small instrument makers it buys up.
That helps clarify why it has constantly delivered double-digit grown in its annual dividend per share.
I like that enterprise mannequin and see sizeable room for future progress on the agency.
