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Stock Markets
UK stock market
58neutral
39.3% above its 10-year average, about as far above as usual | Data for Sep 2026
Hot and cold describe position, not good or bad: warm does not mean a fall is coming, and an extreme reading does not mean a quick reversal. We describe history only, with no buy or sell advice.
What it is
UK stocks: what is measured, and why it matters
What it measures
The monthly average of the UK’s share price index, as compiled by the OECD.
Why it matters
With heavy weights in energy and materials, it often rises and falls with oil prices.
Where it stands now
Position over time
Data: OECD Main Economic Indicators (share prices). Positions: our calculation.
coldcoolneutralwarmhotHatched = earlier periods that were also neutral
When it was here before
Earlier neutral periods (8), plus the current one
UK stocks after it began, cumulative1 yr2 yr3 yr
Feb 1978–Apr 19783-month period, neutral throughout1 yr+13.1%2 yr+27.6%3 yr+43.3%
Nov 1979–Dec 19792-month period, neutral throughout · 1980 Oil crisis1 yr+28.7%2 yr+28.9%3 yr+72.6%
Dec 19881-month period, neutral throughout1 yr+33.3%2 yr+22.3%3 yr+36.2%
Apr 1990–Apr 199449-month period, neutral in 32 of those months1 yr+14.7%2 yr+16.3%3 yr+29.5%
Aug 1995–Apr 199721-month period, neutral in 17 of those months1 yr+10.2%2 yr+41.8%3 yr+59.3%
Oct 19981-month period, neutral throughout1 yr+19.9%2 yr+24.3%3 yr−0.1%
May 2000–Dec 20008-month period, neutral in 7 of those months · 2000 Dot-com bubble1 yr−5.4%2 yr−16.8%3 yr−35.9%
Mar 2017–Aug 201818-month period, neutral in 13 of those months · 2018 February stock sell-off1 yr−3.7%2 yr−2.1%3 yr−22.0%
Feb 2025–now20-month period, neutral in 19 of those monthsStill under way
For each period, the changes 1, 2 and 3 years after it began are cumulative and measured from its first month; “What happened next” is measured from every neutral month, so the two give different numbers. The events named beside each period are major events of that time, not necessarily related to the readings here.
What happened next
How UK stocks moved after earlier months with UK stocks neutral
Bars: median cumulative changeEarlier months with UK stocks neutral, excluding the current period (76)All months (588)
1 yr later
+10.7%down in 26% of cases
+9.2%down in 25% of cases
3 yr later
+29.6%down in 28% of cases
+23.1%down in 21% of cases
5 yr later
+60.4%down in 22% of cases
+32.0%down in 18% of cases
Median of the deepest drop below the starting month within the next 5 years: −3.5% for months with UK stocks neutral; −7.0% for all months.
The neutral months come from a small number of market episodes (8), and neighboring months are not independent events; rises and falls are all listed. This is the historical record, not a forecast.
Where UK stocks went next
Later positions of UK stocks, after past months that were neutral, like now
Median position
Back to neutral (40–60)
Still neutral
1 yr later
46neutral
36%
36%
3 yr later
44neutral
24%
24%
5 yr later
42neutral
22%
22%
Has hot or cold lined up with later returns?
Some link in the past (not a guide to the future)
1977–2021: average yearly change in UK stocks over the next 5 years
Hottest 20%
+11.2%a year
All months
+6.6%a year
Coldest 20%
+4.8%a year
In this period, the hotter the month, the higher the average over the next 5 years. The months overlap, so there are really only a few market episodes. This is a tendency, not a rule, and not a forecast.
Energy and materials shares weigh heavily in the UK market
This issue: Oil at 72 (warm), UK stocks at 58 (neutral) — at least one is in the neutral range (40–60), so we make no call this issue.
○○○Our data show the oppositeAgreement −0.47 · in step in 23 of 42 5-year periods
In most periods the two moved the way the common explanation says, but over the whole history the direction is the opposite: the relationship may have flipped in some eras.
Values
Values over time
Unit: index. Data: OECD Main Economic Indicators (share prices). Log scale: equal heights mean equal percentage changes.
Data and sources
Where the data come from and how they are calculated
Source
OECD Main Economic Indicators (share prices)
Frequency
Monthly
Positions start
Oct 1977
Method
Ratio: this month ÷ the 10-year average; position = the percentile of this ratio within its own history