It’s been an interesting day for UK shares. The Bank of England kept interest rates on hold and upgraded the UK’s growth forecasts. However, it also warned Brexit could yet have a negative impact on the economy, which sent sterling almost 1% lower versus the US dollar.
In my view, that’s good news for investors in Rolls-Royce Holding PLC (LON:RR) (LSE:RR.L). Its share price rose by 1.1% and since the company is a global operator but reports in sterling, I think a weaker pound could be good news for it. I’m optimistic this will improve its investment appeal, while potentially higher defence spending and a sound strategy also make me bullish on the stock.
Brexit may be less good news for Whitbread plc (LON:WTB) (LSE:WTB.L). Although it is expanding abroad, it continues to be UK-focused. Therefore, pressure on consumer spending could make life a little more difficult. However, I think Costa is more of a consumer staple than discretionary, while Premier Inn could see consumers trade down to budget options if the UK economy experiences difficulty.
Among the companies releasing news today was Compass Group plc (LON:CPG) (LSE:CPG.L) and Reckitt Benckiser Group Plc (LON:RB) (LSE:RB.L). Their shares are up 4% and 3.9% respectively. I’m optimistic about their prospects. I feel they offer defensive investment appeal, as well as consistent growth strategies which could allow them to outperform sector peers and other index shares this year.
However, perhaps the most exciting stock of today was Randgold Resources Limited (LON:RRS) (LSE:RRS.L) (author owns shares). The gold price spiked to as much as $1224/oz on uncertainty in the US and potentially because of the comments made by the Federal Reserve yesterday. There was little sign there will be additional interest rate rises beyond those expected this year. Therefore, I think the outlook for the precious metal and for Randgold Resources is relatively positive.