ABN AMRO is steering its clients towards the UK market as a defensive measure highlighting the potential value there. It points out that economic growth is holding up well, inflation is low and earnings expectations have already been cut back to broadly realistic levels and the market is cheap.

The broker favours stocks in the construction, leisure and general retail sector. Internationally it is advocating taking a risk on mining and engineering stocks and cautions that telecommunications, media and technology stocks are still vulnerable to over-investment, disappointing returns and the need to secure financing.