Andy Burnham is set to become the next prime minister later today in what could be the “last roll of the dice” for the UK market, according to Douglas Scott, investment manager at Aegon Asset Management.
UK stocks have been unloved for much of the past decade, with political instability a large factor in investors’ decision to shun the domestic market.
Scott highlighted the series of approaches and takeovers for UK-listed companies this year as a signal for how cheap domestic stocks have become.
There are 29 bids ongoing for UK companies with a total market cap of £61bn, data from Peel Hunt shows. This compares to 40 in the whole of 2025. Five bids have come for companies in the FTSE 100 versus none last year, including Nuveen’s successful approach for asset manager Schroders.
“The one common theme is that overseas buyers, be they listed or private, are buying UK companies with international operations. Indeed, FTSE Russell data shows that 82% of FTSE 100 revenues are overseas, up from 70% in 2014,” he said.
“International buyers are not seeing the UK domestic market as attractive yet and the revolving door at Westminster for prime ministers has not helped that.”
While spending on energy, defence and housing will likely increase under the new-look Labour government, he said, this money will need to come from somewhere, meaning potential tax rises leaving less money in people’s pockets to invest and denting consumer confidence.
Additionally, the UK faces a structural inflation problem due to energy requirements, said Scott. This is important but, as yet, something that “governments of all persuasions have not been able or willing to practically address”.
“As we enthrone the latest in a high turnover line of prime ministers there is a strong feeling that this is the last roll of the dice for UK plc and that failure will result in another revolution, not just of the No. 10 revolving door, but towards an even more dramatic change in government,” he concluded.