It’s certainly true that demand for UK shares has picked up following the 2020 stock market crash. With many top-quality stocks trading at bargain-basement prices this isn’t a huge shock. Still, I’ve been somewhat surprised that the scale of dip-buying hasn’t been larger.
It’s clear that the global economy faces significant challenges in the near term and beyond. A long hangover following the Covid-19 outbreak appears in store for us, while other obstacles to growth include a botched Brexit process and a messy post-election landscape in the US. But make no mistake: the bull market is coming, whether it takes days, weeks or months to arrive.
There are plenty of terrific stocks that should thrive during the 2020s. History shows us that UK share prices always come roaring back following a serious shock. And this allows those who buy shortly after crashes to make a fortune during the subsequent rally.
2 of the best ISA buys for the economic recovery
With this in mind let me talk you through two top-class UK shares I’m thinking of buying for my Stocks and Shares ISA. I expect them to surge in value as the economic recovery clicks through the gears:
- Manufacturers of automobiles and car parts are some of the quickest to rise in value when economic conditions improve. This is partly because they are typically among the shares that fall the hardest during a stock market crash. Consequently they become popular recovery plays. I reckon Trifast is a top UK share to ride the bull market. This business produces bolts, screws and other fastenings for a variety of applications. And it sources more than a third of revenues from the automotive market. Trifast also manufactures components for electronic products and domestic appliances, other sectors that tend to recover strongly during the early stage of the economic cycle.
- Media companies also enjoy handsome share price growth during the start of an economic recovery. This is because advertising revenues tend to rebound quickly when the outlook for consumer spending picks up. As a result, I think newspaper publisher Reach could soar before too long. I also like this particular UK share because of the efforts it’s making to embrace the fast-growing digital marketplace. Today Reach trades on a forward price-to-earnings (P/E) ratio of just 3 times and carries a 6.6% dividend yield. It’s thus worth serious attention from value investors, I feel.
Helping you get rich with UK shares
So I think Trifast and Reach could make investors a fortune during the economic recovery. But they’re not the only UK shares I’m expecting to soar in value. The Motley Fool’s huge catalogue of exclusive reports can help you find even more top stocks for the new bull market. What’s more, they’re completely free and can be sent straight to your inbox.
