French bank asks clients to support Britain and avoid the eurozone

Oil prices are rising about a quarter since late June and hit 10-month highs this week, as Saudi Arabia and Russia reduce supply to offset falling demand. The rise in prices is a boost for giants BP and Shell, which together account for around 13 per cent of the value of the FTSE 100.

Meanwhile, interest rates have increased at the fastest pace since the 1980s, giving a boost to banks’ profit margins. Financial stocks make up almost a fifth of the FTSE 100 by value.

Companies in growth sectors such as technology are typically highly leveraged and therefore more sensitive to rising interest rates. This means that markets with a greater number of technology companies, such as the United States, are a riskier bet.

Hjort said: “We think this type of environment is quite favorable for value investing in general, as opposed to growth. The United Kingdom is a good example of this.”

Another factor in Britain’s favor is that “valuations are simply cheaper,” he said. Earlier this summer, JP Morgan said listed companies in Britain were the cheapest in the world due to “very pessimistic” sentiment towards the UK.

Finally, the UK economy was doing better that the eurozone. Economists at BNP Paribas expected Britain to fall into a mild recession in the first half of next year, but said the economy had proven much more resilient than expected.

Meanwhile, the eurozone faces the prospect of a double recession after quarterly growth figures were revised downwards last week.

Paul Hollingsworth, chief European economist, said there had been “a lot of pessimism” about the UK, especially after Liz Truss’ tenure.

He said: “There was a lot of caution around UK assets. Things have moved on since then. As we saw, the economy performed much better than people expected.

“When we talk to people, they agree that there is some weakness ahead, but it won’t be a serious recession, partly because some of that underlying resilience is there.”

BNP Paribas is one of the largest banks in Europe, with assets of more than €2.5 trillion.