- UK economy unpredictably shrank in August for the first time in two months, tumbling by 0.3%, as per ONS.
- The unexpected drop was propelled by a strong decline in manufacturing and a slight shrinkage in services.
- UK’s GDP is presently just 0.5% above its pre-pandemic level.
With recession alarm bells ringing, the UK economy unpredictably shrank in August for the first time in two months. The UK economy tumbled by 0.3%, according to the Office for National Statistics (ONS) data on Wednesday. The unexpected drop was propelled by a strong decline in manufacturing and a slight service shrinkage, which decelerated the oil and gas sector's growth.
The UK's economic growth was predicted to be flatlined by economists, even amid the high cost pressures on households and businesses. The growth in July was adjusted downwards from 0.2% to 0.1%. Britain's gross domestic product (GDP) presently is just 0.5% above its pre-pandemic level, i.e., the fourth quarter of 2019.
©2022 Kalkine Media®
As per the ONS, the UK economy has witnessed shrinkage over the last three months, with a slight downward adjustment in July. It added that the performances of several consumer businesses, such as retail, were advancing somewhat weakly. Health, as well as sports events, also contributed towards the fall.
Even though the falls were balanced because of better-than-expected summer performance for several professional services, the drop implies that the economy would probably shrink in the third quarter, indicating the beginning of a recession. The Bank of England has already sounded the recession bugle with it, suggesting that country could enter recession by the year end.
While recession fears loom over the UK economy, investors can explore the performances of the following LSE-listed stocks based on their YTD (year-to-date) returns.
Nanoco Group plc (LON: NANO)
With a market cap of £128.65 million, Nanoco Group plc’s YTD return stands at 94.76% as of 12 October. Meanwhile, its one-year return stands at a whopping 105.47%. NANO shares were trading at GBX 39.50 at around 11:30 AM (GMT+1) on Wednesday, witnessing a dip of 1.00%. With an EPS (earnings per share) of -0.01, the company's turnover (on the book) presently stands at £4,801.75.
RPS Group plc (LON: RPS)
With a market cap of £610.52 million, RPS Group plc’s YTD stands at 77.10% as of 12 October. Meanwhile, its one-year return stands at 79.72%. RPS shares were trading at GBX 220.00 around 11:45 AM (GMT+1). With an EPS of 0.02, the company's turnover (on the book) presently stands at £58,399.66.
Energean plc (LON: ENOG)
The YTD return of the natural gas-focused exploration and production business, Energean plc, stands at 60.23% as of 12 October. Meanwhile, its one-year return stands at 50.88%. ENOG shares were trading at GBX 1,370.00 at around 11:30 AM (GMT+1) on Wednesday, witnessing a dip of 0.51%. The FTSE250 listed firm’s market cap at the time of writing stands at £2,451.62 million. With an EPS of -0.54, the company's turnover (on the book) presently stands at £1,408,422.20.