WITH the UK market now back at its pre-September 11 level, further progress has become more difficult, with investors weighing up the on- going politics and the prospects for an economic recession.

So far, the statistics are suggesting that here in the UK a recession will be avoided, with consumer confidence in particular remaining resilient. Mortgage demand appeared to fall sharply in September and, with a double- digit drop in new approvals, an immediate recovery here does not appear to be on the cards.

Further guidance to the health of the economy will come in the next two weeks with reports from both the British Retail Consortium and the CBI. However, and frustratingly for stock markets, it may be some months before a conclusion can be reached.

Interest rates have already been cut sharply, reflecting both recent events and the slowdown in manufacturing. There has been some talk of a further interest rate cut as early as this week, although in order not to blunt the instrument, it is more likely one further cut will arise, though nearer the end of the year.

The second factor behind the market's pause for breath is simply the scale of the maths. The FTSE 100 Index has now risen 700 points from the recent bottom which equates to a rise of 16 per cent, while the US market is up 13 per cent, both in less than a month.

For those followers of share price charts, the FTSE 100 chart suggests the next move may be a rise of eight per cent to 5,600 though the upward path will not be smooth.

If you would like to hear more about our market thoughts, the Teesside office of Gerrard Limited is hosting a morning seminar, called Investing for the Recovery, at Crathorne Hall, on Wednesday, November 7. To reserve a place call Debbie Lister on (01642) 664400.

John Pearson,

divisional director

l Gerrard is regulated by the Securities & Futures Authority. Share prices and the income from them can go down as well as up. Readers are advised to seek professional investment opinion before entering into dealings in securities mentioned in this article, which may be unsuitable in their personal circumstances