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It has been a powerful 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% for the reason that 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%.
Might issues maintain going nicely – and maybe proceed that method after subsequent month, as soon as 2025 provides solution to 2026?
A powerful market amid a combined enterprise surroundings
I believe that there may, doubtlessly, be extra robust efficiency forward of us.
In spite of everything, UK shares have achieved nicely total in 2025 although it has been removed from a banner yr for the British financial system.
Progress has been sluggish, and plenty of companies have complained a couple of rising tax and regulatory burden consuming into their profitability. Shopper 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 nicely even when the financial system stays sluggish. If there are clearer indicators of development, that might assist help a good increased inventory market.
Not immune from the worldwide image
Then once more, we may but see the inventory market wrestle between now and the top of the yr. 2026 is probably not a superb one.
Why? Apart from the British financial system, the worldwide image additionally weighs on the London market.
If there may be weak point in world markets, that might harm investor confidence in Britain and harm UK shares, even when Britain itself is doing tremendous.
Now we have already seen this in 2025. Whereas it’s straightforward to concentrate on the Footsie’s total robust efficiency thus far within the yr, that has been removed from a clean trip. The shock US tariff announcement in April shook markets on either side of the pond.
The worldwide financial 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, somewhat than shopping for the market, I’m searching 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 point and geopolitical dangers I discussed above have harm Judges. Demand in some markets together with China stays subdued.
Some US instructional establishments have seen budgets slashed. I see that as an ongoing danger for Judges’ revenues and income.
However the medium-sized UK firm has constructed a worthwhile enterprise focussed on a market the place prospects are prepared to pay premium costs for top-quality merchandise.
Over the long term, there might 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 persistently delivered double-digit grown in its annual dividend per share.
I like that enterprise mannequin and see sizeable room for future development on the agency.
