Investors have confidence in Theresa May

In a survey of 2,000 personal investors, 50% of respondents also indicated they have faith that Theresa May, David Davis and Boris Johnson will be able to navigate a positive Brexit outcome for the UK.

The new Prime Minister revealed in her first cabinet meeting last week that she will personally take charge of three new ministerial committees – on Brexit, the economy and social reform – to implement her priorities for government.

When asked what action the government should take to stimulate the economy if needed, investors signposted that they would like to see corporate taxes cut (49%) or personal taxes reduced (38%), rather than more Quantitative Easing (22%) or a further interest rate cut (17%).

In regards to further interest rate cuts, interestingly 48% of those asked are concerned about the impact this may cause. With 18% stating that they are more likely to invest in ‘risk assets’ such as equities, bonds or property, whilst 36% said the move would make them more likely to move a cash ISA into such asset classes.

Commenting on the findings, Richard Stone, chief executive at The Share Centre said: “In our survey of investors’ views following the Referendum, they have given a ringing endorsement to the new Conservative Prime Minister, Theresa May, and the Government she has put together. More than 4 in 5 investors believe Mrs May and her Chancellor, Philip Hammond, will be good for markets.

“In terms of how the Government now responds, personal investors would clearly like to see taxes (corporate or personal) cut before either more quantitative easing or further interest rate cuts.

“Almost half are worried about interest rates being cut further and, if they are cut, more than 1 in 3 personal investors said they would be more likely to switch cash ISAs into risk assets such as equities. Current positioning from the Bank of England suggests an interest rate cut is likely in August.

“Personal investors would clearly prefer a joined up approach with the Government deploying more fiscal stimuli ahead of the Bank of England using up its monetary arsenal.”