Belfast Telegraph

Foreign investors boost share slice

More than half of the £1.76 trillion UK stock market is now owned by foreign investors, official figures show.

The Office for National Statistics (ONS) said 53.2% of UK quoted shares were owned by investors outside the UK in 2012, up from 43.4% in 2010.

A glut of international mergers and acquisitions and easier access to shares by foreign investors has driven a swing in the ownership of UK quoted firms since the 1990s, statisticians said.

Less than 20% of the UK stock market was owned by foreign investors 20 years ago.

Of the £935.1 billion stake owned by foreign investors, North Americans own the biggest slice, worth £451.9 billion, followed by Europeans, who own £241.3 billion.

Meanwhile, stock holdings by pension funds and insurance companies, traditionally two of the biggest investors in UK shares, have plunged to all-time lows.

UK pension funds' holdings of shares has fallen to 4.7%, down from 5.6% in 2010 and 21.7% in 1998, possibly reflecting fund managers' search for higher returns and lower risk.

Insurance companies' stake in the UK stock market is down to 6.2% from 8.8% in 2010 and 21.6% in 1998, which the ONS said could reflect a switch to alternative assets.

Stock holdings by individual UK investors rose to 10.7% from a record low of 10.2% two years earlier.

The public sector owned 2.5% of the UK stock market - worth £44.1 billion - largely due to government bailouts of Royal Bank of Scotland and Lloyds Banking Group at the peak of the financial crisis in 2008.

The value of UK stocks edged up 0.2% to £1.76 trillion from £1.75 trillion two years earlier, with the FTSE 100 Index accounting for 85.1% of the total value of the stock market.